In­fla­tion rate climbs to 7.9 per­cent

Lesotho Times - - Business - Bereng Mpaki

LE­SOTHO’S an­nual in­fla­tion rate shot to 7.9 per­cent in April, up from the pre­vi­ous month’s rate of 7.5 per­cent, ac­cord­ing to the lat­est fig­ures re­leased by the Bureau of Sta­tis­tics (BOS).

In its be­lated monthly Con­sumer Price In­dex (CPI) re­port for April 2016, the bureau noted that the spike was driven by among oth­ers, food in­fla­tion which had the high­est in­crease of 15 per­cent, fol­lowed by per­sonal care with 6.9 per­cent, goods and ser­vices for house­hold main­te­nance at 5.3 per­cent, cloth­ing at 5.1 per­cent and footwear at 4.4 per­cent.

BOS gath­ers price in­for­ma­tion in 12 ur­ban cen­tres and 45 se­lected ru­ral ar­eas in the coun­try through monthly vis­its. Dur­ing the vis­its, about 1 000 price quo­ta­tions are col­lected in 780 out­lets for around 200 dif­fer­ent com­mod­ity items.

“The an­nual in­fla­tion rate in this re­port is com­puted by comparing the CPI level of April 2016 to that of April 2015. The an­nual in­fla­tion rate is es­ti­mated at 7.9 per­cent which shows 0.4 per­cent­age points in­crease from the rate ob­served in March 2016,” the bureau said.

“The di­vi­sions, which showed a sig­nif­i­cant an­nual in­crease in the in­fla­tion rate, were: Food and Non-al­co­holic Bev­er­ages (14.8 per­cent), Cloth­ing & Footwear with 4.9 per­cent, Fur­nish­ings, House­hold Equip­ment and Rou­tine Main­te­nance of the House with 4.5 per­cent, Trans­port with 1.2 per­cent, Ed­u­ca­tion (4.9 per­cent) and mis­cel­la­neous goods and ser­vices (4.7 per­cent).”

In the ser­vices divi­sion, the re­port in­di­cated that non-durable ser­vices recorded an an­nual in­fla­tion of 11 per­cent, semi durable ser­vices 4.8 per­cent while durable ser­vices recorded 3.1 per­cent in April 2016.

The BOS’S re­port res­onates with the Cen­tral Bank of Le­sotho’s out­look which last month pre­dicted that Le­sotho’s in­fla­tion rate would con­tinue on an up­ward trend in 2016.

The apex bank had cited the ris­ing of food prices as a re­sult of the El Nino-in­duced drought and the de­pre­ci­a­tion of the rand, to which Le­sotho’s mal­oti cur­rency is pegged, against other ma­jor cur­ren­cies. The drought had ad­versely af­fected the food se­cu­rity of South Africa, which is the main source of food im­ports for Le­sotho, while the weak ex­change rate made im­ports more ex­pen­sive.

Le­sotho’s in­fla­tion trends usu­ally fol­low those of neigh­bor­ing South Africa. How­ever, in com­par­i­son, South Africa’s year on year con­sumer in­fla­tion for April 2016 de­clined to 6.49 per­cent from 6.55 per­cent in March 2016.

THE weak mal­oti ex­change rate with ma­jor cur­ren­cies made food im­ports more ex­pen­sive.

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