whole wheat loaves by five cents at the retail level.

This follows an annual review by the bakery of its prices, general manager John Hershey said yesterday.

Food retailers -- such as supermarkets and convenience stores -- are free to set their customer prices at whatever level they feel the market will bear.

Bermuda Bakery, Crow Lane Bakery and other specialist bread sellers are extremely price conscious, Mr. Hershey said.

At the same time, the price of white sandwich and whole wheat bread has been raised by 30 cents at Bermuda Bakery's Butter Cross outlet, bringing the price to $2.75 per loaf -- "which is still 20 cents less than the bread is available for in the supermarkets,'' Mr. Hershey explained.

He said that the price of a loaf of bread had been held at $2.45 at the outlet "for a long time'' prior to this increase, and that the old price had started to come dangerously near to being below wholesale levels.

"We still sell our bread more cheaply than almost anywhere else on the island,'' Mr. Hershey said.

Bread is one of the basic staples which forms part of the index of pcomnsumer prices, but this small increase is unlikely to drive up Bermuda inflation, which has remained stubbornly below 2.5 percent for almost four years.