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Hyperinflation - A Worldwide Phenomenon

Updated: Oct 17, 2022

Recently, I took a road trip from Kingston to Montego Bay through the parishes of St. Thomas, Portland, St. Mary, St. Ann and Trelawny to enjoy "a likkle bit a mi yaad". I enjoyed a section of the new highway from Kingston to Port Antonio, the green vegetation-laden Blue Mountain range towering in its splendor in the distance and the powerful waves of the Caribbean Sea pounding the scenic coastline. Don’t ask, yes, I ate Boston jerk chicken and pork with a Red Stripe lemon beer, it was just mouth-wateringly delicious. It was an amazing and enjoyable trip, but it was also super costly. I felt assaulted by the high fuel prices. The drastic differences in fuel prices across the country 'hit mi fi six'. The prices for gas (E10 87) varied from a low of J$220/litre in Kingston to a high of J$244/litre in Montego Bay. On my recent travels to USA and Canada the prices of fuel were also very stupendously high. In Canada, gas prices have risen by 48% in the past year, and 12% in the month of May ( Clearly, these surging high gas prices are partly fueling the high inflation that is now a phenomenon worldwide.

Fuel prices across Jamaica in May 2022

We have to become an inflation killer, by “earning more and spending less”.

The trauma and distress caused by Russia Ukraine War, COVID-19 pandemic and high inflation are almost unbearable. Our lives are continuously placed at risk by the many unpredictable risk factors prevailing around us. Some of us have it in our individual grasp to educate ourselves, work hard, and aspire to be successful. However, we have little control over the impact of macroeconomic factors such as gross domestic product, national income, employment, economic growth rate, and fiscal policies on our lives. Furthermore, we have no control over wars or the occurrence of extreme weather conditions such as hurricanes and earthquakes, or even the devastating effects of a 100-year pandemic. What is now clear is that people in both developed and developing countries worldwide are vulnerable and hurting from the scars of hyperinflation. The impact is so severe, that even the rich among us are feeling the pinch, the USA stock markets have lost more than $7 trillion since the start of the year ( International Monetary Fund (IMF), recently highlighted that the global economy faces a ‘confluence of calamities in the biggest test since World War II”.

Keen shopping is a necessity

What is Inflation?

The IMF defines inflation as “the rate of increase in prices over a given period of time. Inflation is typically a broad measure, such as the overall increase in prices or the increase in the cost of living in a country”. The Consumer Price Index (CPI) is the cost of a basket of commonly purchased items at a given time expressed relative to a base year. The percentage change in the CPI over a certain period is called consumer price inflation. The movement of inflation over the last 12 months has been dramatic worldwide. Inflation rates in Canada, USA and Jamaica are presently 7.7%, 8.6% and 10.9% respectively. Jamaicans have experienced over a 100% increase in inflation over the last 12 months.

Some drivers of inflation

What are the drivers of Inflation?

Recently, many have argued about the main drivers of high inflation at this time worldwide. There seems to be a general consensus on these major factors:

  • Rising Costs of Labour – The employment market has drastically changed during the COVID-19 pandemic, with many working from home and there is a shift towards business process outsourcing. Numerous workers have been leaving low-paying jobs for more lucrative ones. This has forced employers to increase salaries above minimum wage to attract new workers and retain existing ones. The provision of greater government subsidies and grants to unemployed persons, coupled with workers staying home due to the fear of COVID-19 has lessened the availability of workers for employment. Some countries like the USA with very low employment levels, 4.8%, have less skilled workers available for employment. This further drives up the cost of labour.

  • High Energy Cost – Globalization has created a connected world where goods, services and people are constantly shifting across borders. Energy is an important input in the manufacturing and distribution of goods and services, consequently, any movement in the cost of energy is passed on directly to the consumer. The price of a barrel of oil has moved from US$66.40 to $103.41, which represents an increase of 65.81% over the last 12 months up to the end of May 2022. It is this movement in the price of crude oil, which drives fuel cost, which is showing up at gas pumps worldwide. Since the start of the Russia and Ukraine war in January 2022, the price of crude has moved by approximately 12% as uncertainties and fuel production are curtailed.

  • Global Logistics Problems – During the height of the COVID-19 pandemic many countries were forced to close their borders, which disrupted global trade. Many manufacturing facilities were taken offline as their workers were sent home, while others were closed because of the unavailability of raw material. Furthermore, many companies repurposed their manufacturing and logistics systems to facilitate the production of medical equipment and supplies to combat the effects of the COVID-19 pandemic. The supply and demand nightmare drove up shipping costs and caused significant logistic delays and many companies were forced to forward buy and stock up on costly inventory. As the impact of the COVID-19 pandemic is mitigated and countries open up, the supply and demand imbalance will become even more profound.

Inflation profiles of selected countries (Refinitiv)

Dr. DF Suggestions

The following are 10 simple, but useful suggestions you can consider to enhance your financial status during these inflationary times:

  1. Invest in stocks of businesses that are able to increase the price of their products naturally during inflationary periods ( Also, invest in companies that have low costs of production and those that pay out dividends.

  2. Invest in real estate property, and give it time to leverage the gains over time ( In the case of Jamaica, house prices never seem to go down, so your gains over time are assured.

  3. Invest in you, the best investment in life is an education. Knowledge is truly power. Warren Buffett argued that “If you’re the best teacher, if you’re the best surgeon, if you’re the best lawyer, you will get your share of the national economic pie regardless of the value of whatever the currency may be” (

  4. Invest in good quality products that are more durable and longer lasting. Support our local indigenous products that are manufactured by homegrown labour. This will reduce our dependency on imported goods and services.

  5. Covert your savings to productive use or pay down high-interest loans. If the inflation rate is higher than the interest rate you are getting on your savings, your money is losing value.

  6. During periods of high inflation focus more on your mandatory expenses - Food, Utilities, Housing and Transportation. You should purchase affordable goods, ensure that you get greater value from your money and share your mandatory costs with others.

  7. Postpone making discretionary purchases that will increase your cost of living. Delay buying a new car using a loan, especially those with large engines, reduce costly vacations and recreational activities, and reschedule remodeling of your home.

  8. Increase and diversify your income generation possibilities. Especially, through the leveraging of your innate skills and creativity. If you have a job, agitate for more pay or find yourself a higher-paying job.

  9. Invest in "do it yourself (DIY)" handy tools and equipment and start doing minor work for yourself. Access fewer services from your hairdresser, barber, car washer, gardener, plumber, carpenter and mechanic.

  10. Invest in renewable energy equipment for your house and business. You should install photovoltaic systems where possible and invest in hybrid vehicles that are more efficient than gas-guzzler fossil fuel vehicles.


In these inflationary periods, you will get less value for every dollar that you spend. Clearly, our survival will require us to develop simple money management strategies to combat this high inflation. I have one simple rule ‘earn more and spend less’. Compensate for your eroding income by diversifying your income streams and eliminating your discretionary spending. Be an inflation killer by out-earning the prevailing inflation rate. Your employer determines how much you make but YOU decide how much you spend.....less is the new more!

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Terry Ann Campbell
Terry Ann Campbell
Sep 10, 2022

Some very useful and practical tips here!


Aug 13, 2022

Good piece. I appreciate the practical suggestions for this worldwide problem ..2,3,6 and 7 resonate without me.


Carl Bliss
Carl Bliss
Jul 12, 2022

Excellent article my friend. Keep informing and educating us all. Bless you!


Postponing discretionary purchases is the most fundamental in opinion and the hardest change for most people.. We have been indoctrinated into the behaviour of which we work, make our money and we can do what we want. Collectively, we have lost the notion of doing what we need and being content.

Donald Farquharson
Donald Farquharson
Jun 29, 2022
Replying to

That is so true.... But we have to try.


This is indeed helpful. Thank you for sharing

Donald Farquharson
Donald Farquharson
Jun 29, 2022
Replying to

Your welcome, please keep enjoying my blogs.

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