The latest report from the Economics and Statistics Office estimated Cayman’s annual rate of inflation at 2.8% in the first quarter of 2026, up from 1.3% in the previous quarter.
Given the global energy shock that unfolded in the first three months of 2026, it is little surprise that Cayman’s annual consumer price index (CPI) increased. The West Texas Intermediate spot price for a barrel of oil was US$102.86 on 31 March 2026, up from US$71.87 per barrel on 31 March 2025.
That higher cost of crude would have pushed up Cayman prices in a variety of different ways. It would have taken some months for global energy price increases to filter through to local electricity and fuel prices. Indeed, while the report shows electricity prices up by 5.1% year-on-year, transport and fuel prices fell over the period.
But, in addition to the direct increase in electricity costs, there would also have been indirect increases to most goods in supermarkets because of higher shipping and logistics costs. Cayman imports more than 90% of the goods and food it consumes, and the report shows widespread price increases in import-sensitive categories, including clothing, household goods, food and communication services and equipment.
Minimum wage pushes up prices
Another factor was the increase to the minimum wage. Furnishings, household equipment and routine household maintenance saw prices rise by 6.7%. The report said the main reason for this increase was “a 45.8 percent rise in the index for employed staff (paid staff privately employed) as minimum wage increases took effect on January 1”.
The wage increase may also explain some of the 5.1% rise in prices at restaurants and hotels in the first quarter of 2026, compared to the same period the previous year. But the report highlighted the main factor as the “6.5 percent increase in the cost of accommodation services (local and abroad)”.
There was also a sharp increase in the quarter-on-quarter figure. Cayman’s CPI in the first quarter of 2026 was 0.8% higher than in the fourth quarter of 2025. Cayman only reports inflation numbers every quarter – unlike the US or the UK, where inflation numbers are released monthly. That lower frequency of reporting means it can feel like there are larger swings in Cayman’s reported inflation rate, compared to jurisdictions where the numbers are updated monthly.
With the global energy shock now subsiding and the West Texas Intermediate oil price back around US$70 per barrel, it remains to be seen if next quarter’s inflation report will show lower inflation.
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