While inflation has increased as a result of the war in Ukraine and supply chain issues, it is not expected to rise above five percent on an annual basis, Financial Secretary Simon Wilson said yesterday.
Wilson, who spoke on the sidelines of yesterday’s eProcurement portal launch, said fuel costs, which will translate into energy costs, are a large reason behind the inflation being faced in the country.
He added that there has been inflation in the cost of some food as well as a result of a combination of the factors mentioned.
Despite this, Wilson said he has faith that measures put in place by the government will relieve the burden of the increase in costs in certain sectors and for certain items.
The government recently reduced duties on certain items and eliminated duties altogether on some.
“We expect it (prices) to rise because we import inflation. But we don’t expect it to be a dramatic rise,” said Wilson.
“We see inflation being elevated in comparison to the last 10 years because of global factors, but we don’t see it at a high level.
“So, we don’t see inflation rising above five percent on an annual basis.”
He said inflation has not been domestically generated and therefore has not been affecting fiscal policy.
“We have a conservative fiscal policy,” Wilson said.
“The government’s deficit is going down, so the money supply is not expanding rapidly.
“So, we expect to see, if there is any inflation, it’s going to be imported inflation, but not largely generated domestically.”
The latest Consumer Price Index released by the Bahamas National Statistical Institute showed consumer prices climbing seven percent year over year at the end of July.
