The average price of goods and services in Cayman increased by 3.5 percent in the third quarter of 2018 over Q3 of 2017, according to recently released data from the Economics and Statistics Office.
The territory had been experiencing falling prices from 2015 through late 2016, but that trend has reversed over the last two years, the statistics show.
Inflation increased at a more rapid pace through the first three quarters of last year. The annualized inflation rate averaged 4 percent through June 2018, the highest half-year increase since June 2005, according to the Economics and Statistics Office.
In Q3, the main driver of inflation was a 6.3 percent increase in transport prices, which was, in turn, caused by a 10.7 percent increase in fuel prices and an 8 percent increase in airfares.
The Economics and Statistics Office noted that the increase in airfares was the lowest increase in a year. Airfares increased by 52.3 percent in Q2 of 2018, 21.5 percent in Q1, and 31.8 percent in Q4 of 2017.
The sector that saw the second highest inflation rate was housing and utilities, which moved up by 5.5 percent, largely due to electricity rates spiking by 32.3 percent. Housing rental costs were stable during the quarter relative to the same period in 2017.
Electricity rates saw a major increase throughout the first three quarters of 2018, rising at an average rate of 23.3 percent during that time. The sharp increase followed slight drops in electricity prices by 1.4 percent apiece in Q3 and Q4 of 2017.
Food prices increased by 4.2 percent, driven by rising prices of fruits (11.8 percent), dairy products (8.1 percent), and bread and cereals (8 percent). Communication costs rose by 3.5 percent, with telephone equipment rising by 10 percent and services rising by 2.9 percent.
Education costs also rose by 3.2 percent as costs in pre-primary, primary, secondary, and tertiary education all saw increases.
In health, there was a 1 percent rise in the index for this division, largely traced to prices for pharmaceutical products rising by 2.6 percent and other medicinal products by 2.3 percent.
Miscellaneous goods and services, as well as recreation and culture also both increased by 0.8 percent and 0.4 percent, respectively.
Meanwhile, the prices of clothing and footwear fell by 1.7 percent. Locally purchased clothing and footwear fell by 3.5 percent, while the U.S. indices for that category increased by 0.7 percent.
Restaurant and hotel prices also decreased by 0.6 percent, and alcoholic beverages and tobacco prices fell by 0.2 percent.