Bermuda's inflation rate jumped to its highest level since 2001 in January, as rising fuel costs drove transport costs up.

The annual rate of inflation was three percent, meaning that the average cost of goods and services were three percent higher in January than they were 12 months earlier.

The increase marked the fourth consecutive month that the rate of inflation increased. The inflation rate in September, 2002 was two percent and inflation was never higher than 2.6 percent through the first nine months of last year.

The Department of Statistics said the strongest price movements were recorded in the transport and vehicles sector, with premium and mixed fuel rising three percent and 1.8 percent. Foreign travel costs rose 0.7 percent as airfares rose and foreign hotel costs also rose.

The average cost of cycle repairs and maintenance jumped 4.4 percent.

A 2.6 percent decline in the fuel adjustment clause for electricity prices meant that the fuel and power sector declined by 0.4 percent.

Food prices rose 0.2 percent while rents rose 0.1 percent.

But there was good news for drinkers as the tobacco and liquor sector declined 0.1 percent as a result of a reduction in the average price of wines (down 0.3 percent) and liquor (down 0.2 percent).

Childcare service prices jumped 3.5 percent, driving the household goods, services and supplies up 0.4 percent and health and personal care costs rose 0.1 percent.