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Inflation at 2.5% – but some food prices rise by almost a third

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Counting the cost: some food prices have shot up dramatically in the past year (File photograph)

The cost of some food items has increased by almost 30 per cent in the past year, according to the latest figures.

Statistics released by the Government’s Department of Statistics yesterday show that the price of some meat, fresh fruit and vegetables rose sharply in the 12 months up to March this year.

The Consumer Price Index recorded that top round beef rose by 29.3 per cent, while frozen spare ribs increased by 28.8 per cent, imported lettuce rose by 20.9 per cent and apples by 13.6 per cent.

The figures came after the Cabinet met on Tuesday to discuss moves to provide financial support for families struggling to buy basic groceries. Details of that meeting of ministers have yet to be revealed.

Restaurant owners say soaring food costs have forced them to increase the prices on their menus.

According to the figures, there have also been significant increases in the cost of vegetable juice, canned tuna, and milk, although some prices also fell – red grapes fell 6.7 per cent, frozen broccoli and spinach fell by 6.6 per cent and sweet biscuits by 6.4 per cent.

Overall, the department said that inflation had risen by 2.5 per cent in the past year – because prices have remained flat or even fallen in other categories used to measure the index, such as rent.

The rent sector has fallen by 0.7 per cent in the past year and the annual average cost of properties dropped by 2.4 per cent, the report said.

Fuel and power prices have remained steady since March, and the cost of tobacco and alcohol fell.

Jason Hayward, the Minister of Economy and Labour, said the transport and foreign travel sector continued to be the most significant contributor in driving up prices.

He said: “On average, annual increases were reported in the cost of overseas hotel accommodations, up 50.3 per cent and airfares, up 7.9 per cent.

“Within the education, recreation, entertainment and reading sector, reading materials such as magazines, books and newspapers rose 16.3 per cent year-over-year. In addition, entrance fees to sporting events increased 5.7 per cent.”

Mr Hayward also confirmed that plans to update the method in which the index was calculated were being drawn up. There have been criticisms that the basket of goods selected to measure inflation is outdated.

Critics have also questioned why Bermuda’s inflation continually lags behind the US, UK and Canada, where inflation currently stands at 8.5 per cent, 9 per cent, and 6.7 per cent respectively.

Mr Hayward said: “The current CPI basket of goods and services is derived from 2013, which collected income and expenditure patterns and levels for all residents. This set April 2015 as the current reference point of Bermuda’s shopping basket.

“In response to a request from the Department of Statistics in June 2022, the Caribbean Regional Technical Assistance Centre conducted a technical assistance mission to improve the CPI.

“The mission included designing and conducting a household expenditure survey to estimate expenditure weights.

“During this exercise, Cartac advised that international best practice had shifted to where household expenditure surveys should be conducted every five years instead of ten and recommended data collection over 12 months to capture seasonal spending habits better.

“It is anticipated that the Department of Statistics will commence data collection on a new household expenditure survey within the next 12 months.

“However, a revised CPI ‘shopping basket’ and expenditure weights will not become available until approximately two years after the data collection is completed, which will see the base year shift from 2015 to 2025.

* In our business section today: The restaurant industry is facing some of its toughest times in decades, according to local eatery owners. Click here for more.

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Published June 23, 2022 at 9:55 am (Updated June 23, 2022 at 9:55 am)

Inflation at 2.5% – but some food prices rise by almost a third

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