In T&T: Inflation on the rise again. Food prices continue to climb

27 February 2012


Seasonal (Lenten) fish demand adds to inflationary pressure. Credit recovery “modest.”

The rate of inflation in Trinidad and Tobago is climbing again.

The latest available data from the Central Statistical Office (CSO) showed that headline inflation rose to 6.8 per cent in January, up from 5.3 per cent in December last year, the Central Bank said yesterday.

Headline inflation registered a monthly increase of 2.5 per cent in January‚ÄĒthe highest monthly increase since June 2010, the Bank said in its repo rate statement.

Food prices have contributed to higher inflation.

“The continuing rise in food prices was the main reason behind the pick-up in the headline inflation rate,” the Bank said. “On a year-on-year basis, food prices rose by 14 per cent in January 2012 from 10.9 per cent in the previous month.”

The increase in the food price index was led by fruits, vegetables and fish.

CSO data also indicated that credit in the financial system continued its modest recovery in December 2011 where an increase in loans for real estate mortgages, and to business firms, were the main areas in which growth was evident, the Bank stated.

Business lending rose by 6.9 per cent last December after being in decline for most of 2011.

Liquidity in the financial system has remained high with commercial bank balances at the Central Bank in excess of required levels averaging $5 billion during the first three weeks of February, the report said.

The Central Bank said it would maintain the repo or overnight lending rate to banks at 3.0 per cent.

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