Fuel price ease in May

THE average fuel price in Honiara falls in May to $8.50 per litre, following an increase in the previous months, the Central Bank of Solomon Islands (CBSI) monthly economic bulletin revealed.

The CBSI May economic bulletin stated that the average fuel price eased in May to $8.50 per litre, after an upturn in the previous month.

“The fall was due to slight declines in all three fuel categories with diesel down by 12 cents to $8.36 per litre, petrol slipping by 2 cents to $8.55 per litre and kerosene falling by 5 cents to $8.58 per litre from the previous month.”

Meanwhile, it said that the headline inflation for the month of April further decelerated to negative 3 per cent from minus 0.3 per cent in the previous month, continuing the downward trend since it peaked in June 2014 at 7.2 per cent.

“This was driven largely by domestic inflation falling below zero to minus 3.3 per cent from 0.1 per cent a month prior, while the imported component remained negative at minus 1.8 per cent.

“The substantial decline in domestic inflation was largely driven by the food prices falling from 1.4 per cent to minus 6.6 per cent. A significant fall in drinks and tobacco to minus 24 per cent as a result of betel nut prices plunging more than 60 per cent also contributed to the fall.

“Similarly, housing and utilities further eased from 3.2 per cent to 1.3 per cent. The declining prices in these components outpaced the increase to 4.1 per cent in household operations and sustained prices in clothing and footwear at 23 per cent, transport and communication with 2.7 per cent, and recreation rising at 9.8 per cent.

“In terms of contributions to overall headline inflation, the deflation of 3.0 per cent was primarily accounted for by steeper falls in food prices, housing utilities and the transport & communication categories to minus 1.2 per cent, minus 0.7 per cent and minus 0.4 per cent, respectively.

“The remaining components made marginal contributions to the overall deflation for the month. Similarly, the core inflation for April further contracted to 1.8 per cent from 2.1 per cent a month prior.”