Fuel and power costs rose 27.5 percent in the year up to May 2008, but the overall rate of inflation has now dipped below five percent.

Figures released yesterday by the Department of Statistics and show that consumers paid 4.7 percent more for goods and services included in the Consumer Price Index (CPI) in May than they did a year before.

That marks a slight fall from the 5.3 percent figure recorded in April — the highest inflation rate in 18 years.

Food prices rose 4.5 percent year on year and the clothing and footwear sector also saw a four percent hike.

But the main driver of rising prices was the soaring cost of oil, reflected by substantial price rises in fuel and power, and transport and vehicles.

The CPI report found that power company Belco increased the fuel surcharge on electricity bills by two percent in the month from April to May. The month also saw a 2.4 percent rise in the average cost of propane gas.

Prices at the pumps saw an even sharper monthly rise as gasoline rocketed by nearly six percent. As a result, the transport and vehicles sector saw a 0.4-percent increase for the month and a rise of 5.7 percent, year on year.

Food prices actually fell 0.1 percent in May, following their sharp rise in April. The CPI report said the main factors behind the decrease were green peppers (-8.6 percent), carrots (-7.7 percent) and frozen spare ribs (-4.7 percent).

Rents are not climbing at the rate of most other costs of living, however. Rents rose 2.4 percent in the 12 months through May this year and 0.3 percent from the month before.

And the household goods, services and communications sector actually decreased by one tenth of a percent for the month.

Beer, wine, cigarettes and spirits all saw price increases in May and the tobacco and liquor sector is up 10.3 percent year on year.

Consumers also paid more in the health and personal care sector, thanks mainly to a 3.1-percent rise in the price of men's haircuts and a 1.7-percent climb in ladies' hair-styling services.