Inflation has dropped below four percent for the first time since April this year.

The monthly rate fell to 3.6 percent during September, helped by cheaper foreign-travel costs for Bermuda residents.

That was the only section of the economy to record a fall in costs, however price rises elsewhere were relatively modest.

The September figure also brought to a close the third quarter and bumped up the three-month period to an annual four percent rise, the first time since the opening three months of 2005 that quarterly inflation has been so high.

With global oil prices now around the $100-a-barrel mark, gasoline prices remain on an upward trend (1.1 percent higher month-on-month in September) and this is also reflected in the fuel and power sector where the rise was 1.5 percent - with residents paying more for electricity on the Island as the fuel adjustment factor of household bills climbed by three percent.

Higher oil prices also impacted the cost of groceries and other retail items that have to be transported. The cost of imported cod fish and butter rose by 3.9 and four percent, respectively.

There was a notable increase in the costs of child-care services, which are now 4.8 percent higher than a month ago.

Using the figures released by the Department of Statistics, a basket of goods and services that cost $100 in April 2006 would have cost $105.10 during September. The basket of goods increased in cost 20 cents between August and September.

On a year-on-year basis the biggest change was in the transport and vehicles sector where costs have risen by seven percent, closely followed by health and personal care (6.6 percent) and fuel and power (6.1 percent).

Rents have risen 1.8 percent year-on-year.