The rate of inflation in Trinidad and Tobago has accelerated.
The latest available data from the Central Statistical Office (CSO) released by the Central Bank yesterday showed that headline inflation picked up in October, after falling for four consecutive months.
Headline inflation surged to 9.4 per cent in October, up from 7.7 per cent in September and 3.7 per cent one year ago.
"On a monthly basis, headline inflation rose by 1.4 per cent in October 2012, compared with an increase of 1.1 per cent in the previous month," the Central Bank said in its latest repo rate announcement yesterday.
Higher food prices, particularly for fruits and vegetables, were mainly responsible for the acceleration in the headline inflation.
On a year-on-year basis, food price inflation reached 18.2 per cent in October from 14.7 per cent in September.
Key components in the food basket which recorded faster prices increases were vegetables, fruit, meat and fish.
There was a slight deceleration in the price increases for bread and cereals, milk, cheese and eggs.
"The impact of the removal of VAT on a range of food items has not been reflected in the inflation data for October 2012," the Central Bank stated.
High liquidity levels continued to suppress short term interest rates, the Bank observed in its repo rate review.
Notwithstanding the increase in headline inflation, the Bank said there was evidence that underlying inflationary pressures remained contained.
"Although current financial conditions provide a strong enough basis for an expansion of private investment, business demand for credit remains relatively subdued," the Central Bank said, adding that it will maintain the repo or overnight lending rate to commercial banks at 2.75 per cent.