September 18, 2020

Latest CPI figures released and costs are rising

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The latest Consumer Price Index (CPI) figures have just been released by government and although inflation (despite the recession) increased only marginally (0.1%) compared to 2011 we, here in the Cayman Islands, spend a lot more on fuel (6.4%).

These latest CPI figures relate to the first quarter of 2012 and one has to dig real deep into the information supplied (mainly from tables – see below) to understand the reason for the only marginal rise. It is mainly because of a fall in the cost of renting. With the cost of food and drink rising over 5% compared to last year not many of us can take much comfort when we are told inflation rose marginally.

The cost of seafood (increased by 11%), fruit (8.8%), soft drinks (7%), oils and fats (9%), water (10%), electricity, gas and other fuels (4.2%) and glassware, tableware and household utensils (incredulous rise of 16.1%!).

To keep healthy is also costing you with outpatient and hospital services both costing over 4% more. On a brighter note, medical products, appliances and equipment have gone down.

Transport costs have also risen dramatically: vehicles purchase costs and operational equipment in using it is 7.4% more than last year. If you use public transport, that has cost you 4.6% more.

To purchase telephone and telefax equipment that has dented your pocket book by another 7.4% and to use both services another rise of 2.2%.

If you took personal care that cost you 4.3% more and an incredible 11.6% more for your personal effects.

Whilst government will take some comfort in the minute rise in inflation, they should not. If it wasn’t for the imputed rental figures (imputed rent means the value of the good is more a matter what the buyer is willing to pay than the cost the seller incurs to create it; thus, for example if one could rent a similar property for less than the costs, one is losing money on the deal and vice versa) going down by 9.6% the inflation figure would not have looked so good.

It also tells government that things are definitely going in the wrong direction. There is a huge reduction in the demand for rental properties. What is that telling them?

Please see now the tables and figures.

 

 

 

 

 

 

 

 

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