Investors in combatant mood - Monthly inflation down, but push on for higher interest rates

Published: Friday October 24, 2008

Inflation moderated in September to 0.6 per cent, its lowest monthly out-turn this calendar year, but investors continued to push for higher interest rates to offset some of the negative returns on their investments.

The market this week bid up interest rates at the latest Treasury bill auction by one and a half points, relative to September.

The six-month T-bill was under- subscribed by 1.1 per cent.

The consumer price indices for utilities, fuel and housing, transportation, as well as communication, which captures cellphone usage, showed no increase, while food and beverage, where spending tends to be high, rose only 1.5 per cent.

The 'alcoholic beverage and tobacco' category rose by just 0.3 per cent, the lowest movement since the start of the fiscal year in April.

Inflation data

September

Monthly 0.6 per cent
Year to Date 16.8 per cent
Fiscal YTD 11.0 per cent
Annual 25.3 per cent

Interest rates

October

BOJ signal rates

30-day 14.65 per cent
90-day 14.40 per cent
180-day 14.70 per cent
365-day 15.50 per cent

Treasury bills

90-day 15.4 per cent
182-day 16.96 per cent


Source: Jamaica Gleaner
http://www.jamaica-gleaner.com/gleaner/20081024/business/business1.html