By Javaughn Keyes
The Bank of Jamaica (BOJ) estimates that inflation will likely fall outside its 4 to 6 per cent target range over the next year.
The central bank's Monetary Policy Committee says for much of the period between December 2023 and March 2025, inflation could fall outside of the range.
This would be primarily due to the continued impact of the increases in select public passenger vehicle fares.
Annual inflation as at November was outside the target range, at 6.3 per cent.
This was driven by an increase in some bus fares and higher domestic agricultural prices.
The medium term inflation forecast is also linked to higher-than-projected future wage adjustments, in the context of the tight domestic labour market.
The Committee says deterioration in supply chain conditions could also influence higher inflation.
It says, however, inflation could be lower if oil and grains prices trend well below the forecast.
Other downside risks include weaker-than-expected global growth, which could have a stronger-than-projected downward pull on domestic demand and imported inflation.
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