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Deflation continues for fifth month running

Falling rents: Rent for homes not subject to rent control fell by 5.4 per cent year over year in November, 2020.

Bermuda’s annual inflation rate remained negative for the fifth consecutive month in November at -0.1 per cent.

In July 2020, the island recorded its first negative inflation rate since 1965.

Consumers paid 0.1 per cent less for a basket of goods and services included in the Consumer Price Index in November, than they did in the same month in 2019.

Between October and November, the average cost of goods and services in the CPI increased 0.1 per cent.

The all-items index rose from 105.7 to 105.8 in November.

This means that the basket of goods and services that cost $100 in April 2015 now costs $105.80.

The transport and foreign travel sector was the largest contributor to the 12-month decrease in the CPI, as prices dipped by 5.3 per cent. The average price of overseas hotels decreased by 19 per cent, year-over-year.

The rent sector also impacted strongly on the annual rate of inflation, dropping by 2.2 per cent, as properties not subject to rent control fell 5.4 per cent, year-over-year.

In contrast, the food sector climbed 2.9 per cent between November 2019 and November 2020.

In November, transport and foreign travel sector prices advanced 1.5 per cent on average as air fares increased by 8 per cent, overseas car rental costs were up by 6.2 per cent and the cost of motorcycles rose by 1.9 per cent.

Prices in the household goods, services and supplies sector increased by 0.2 per cent for the month. The average cost of refrigerators and freezers rose 10.8 per cent. Consumers paid 6.2 per cent more for stoves.

The tobacco and liquor sector rose 0.1 per cent in November, reflecting a 0.5 per cent increase in the average price of beer.

Food sector prices dipped 0.2 per cent for the month. The average cost of potatoes declined 9.3 per cent, the cost of cheeses dropped 5.5 per cent and fresh and frozen pork loins declined by 5 per cent.

Prices in the education, recreation, entertainment and reading sector declined by 0.2 per cent in November. The average cost of personal computers and toys, games and hobbies were down by 4.5 per cent and 3.9 per cent, respectively.

The rent sector slipped 0.2 per cent, with the decrease attributed to a 0.5 per cent fall in the average rent for units not subject to rent control.

The health and personal care sector was static for the month. A 0.1 per cent drop in the average cost of toiletries, cosmetics and perfumes was offset by the increased average costs of self-prescribed medicines and household medical supplies, which rose by 0.2 per cent.

The clothing and footwear sector was unchanged for the month, and there was no price movement in the fuel and power sector.

Wayne Furbert, Minister for the Cabinet Office, said: “I have said this previously, but it bears repeating – our economy continues to be significantly impacted by the challenges due to the Covid-19 pandemic.

“However we have a resilient economy. And despite the challenges, we are encouraged that residents are keeping our economy going by supporting our key industries.”

Data was compiled by the Bermuda Government Department of Statistics.

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Published March 24, 2021 at 10:40 am (Updated March 26, 2021 at 9:08 am)

Deflation continues for fifth month running

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