Fiji recorded a headline consumer price index (CPI) decline of 3.8 per cent year-on-year in September this year and marked a sharp deflationary trend for seven consecutive months.
The average annual inflation for the 12 months to September stood at -0.9 per cent, confirming a sustained period of price declines.
Westpac Fiji senior economist Shamal Chand said the deflation was largely driven by the 8.2 per cent drop in prices of food and non-alcoholic beverages year-on-year, and in transport where prices declined by 8.1 per cent – reflecting lower fuel and spare parts costs.
He said despite the annual deflation, the CPI in the month rose by 0.3 per cent, and suggested that underlying inflationary pressures “may be building”, particularly in food items such as meat, dairy, oils and beverages, something he added had been observed in many other economies recently.
“This could indicate a bottoming out of price declines, with potential for inflation to re-emerge in the coming months,” Mr Chand said in the bank’s Westpac Wave publication.
He said Fiji’s inflation landscape this year had undergone a significant transformation, driven by a statistical rebasing of the CPI and evolving global price dynamics.
He said the Fiji Bureau of Statistics (FBoS) had rebased both the GDP and CPI to a 2019 base year, aligning with consumption behaviour just before the pandemic.
Mr Chand said the rebase also revealed that inflation peaked during the post-pandemic recovery, reaching 8.2 per cent year-on-year in August 2022, and validated earlier debates about the intensity of price pressures during that period.
He said the new base provided clarity on how prices evolved, but also highlighted the limitations of comparing pre and post pandemic data without accounting for structural changes in the economy.
“Fiji’s inflation in 2025 reflects a transitional phase. The CPI rebase to 2019 better captures current consumption, revealing deflation driven by falling food and transport prices.
“Despite annual declines, monthly inflation rose slightly, hinting at emerging pressures. Global fuel dynamics and domestic shifts suggests that inflation may return.”
According to Westpac Wave, the CPI rebase is based on the 2019–2020 Household Income and Expenditure Survey (HIES), replacing the previous 2014 base.
The new CPI basket includes 309 items, down from 349, with notable reductions in the food and non-alcoholic beverages, and recreation and Culture categories.
Expenditure weights have also shifted, with alcoholic beverages, tobacco and narcotics seeing a sharp increase, reflecting higher household spending on beer, cigarettes and yaqona.
