Bermuda Economy 2012: Mid-Year Economic Review

Summary Economic Indicators: Mid-Year Economic Review 2012

*Comparative data over the first half of 2012, except when otherwise indicated.

  • The headline rate of inflation in September 2012 stood at 1.9 per cent year-over-year. The primarily causes of inflation during the last twelve months were increased costs of medical supplies, prescription drugs and health insurance premiums in the Health & Personal Care sector, rising food costs and higher residential electricity costs in the Fuel & Power Sector.
  • Imports fell by 3.5% in the first quarter to register at $207.3 million.
  • During the first nine months of 2012, there was a 1.7 per cent decline in the number of visitors to the island. Both air and cruise visitor figures fell during that time period with air visitors to the island declining by 1.9 per cent and cruise visitors decreasing by 1.7 per cent.
  • Total visitor spending for the first six months of 2012 was down by 15.5% settling at $169.2 million.
  • Some 632 new international companies and partnerships were registered in Bermuda during the first nine months of 2012 representing a 1.3% increase over 2011 registrations of 624.
  • Over the first half of 2012, activity in the construction industry declined by 7.5 per cent.
  • Employment income contracted to $1.654 billion, a decrease of 5.2%.
  • Total consumer spending in retail outlets between January and September 2012 grew by $6.1 million or 0.8 per cent to register at a total of approximately $799.7 million. Of that amount, approximately $750.4 million was spent locally while $49.3 million was spent overseas.
  • Bermuda’s Balance of Payments in the first half of 2012 recorded a surplus on the current account of $421, representing an 11.7% or $44 million increase year-over-year. The investment income account was the largest contributor to the current account surplus.
  • Based on figures released by the Bermuda Monetary Authority, Bermuda’s money supply contracted by 4.7% year over year during the first two quarters of 2012.
  • The Banking sector’s total assets increased by 2.1% during the first six months of 2012. The rise was driven mainly by a 7.0% reduction in investment activity in the first quarter of the year.
  • Total loans and advances increased by 8.0% during the first two quarters of 2012 while customer deposits also grew by 2.7% for the same time period.
Economic data for the first half of this year are consistent with the Ministry of Finance expectations that the economy will remain weak in 2012 and that Bermuda’s GDP will decline in the region of 1.0 – 2.0 per cent in 2012.