Le­sotho in­fla­tion tops SACU re­gion

Lesotho Times - - Business - Bereng Mpaki

LE­SOTHO’S year-on-year in­fla­tion rate dur­ing the month of June 2016 was the high­est in the South African Cus­toms Union (SACU) re­gion.

Ac­cord­ing to SACU’S monthly in­fla­tion re­port for June 2016, Le­sotho and Swazi­land had an an­nual in­fla­tion rate of 7.5 per­cent, which is the high­est among the five mem­ber states.

SACU is the world’s old­est cus­toms union and con­sists of Botswana, Le­sotho, Namibia, South Africa, and Swazi­land.

The in­fla­tion rate is the level at which prices of goods and ser­vices is ris­ing and, con­se­quently, the fall­ing of the pur­chas­ing power of a cur­rency. The in­fla­tion rate is vi­tal for pur­poses of eco­nomic pol­icy-mak­ing, es­pe­cially the con­duct of mone­tary pol­icy.

“The high­est an­nual in­fla­tion rate among the mem­ber states was reg­is­tered in Le­sotho and Swazi­land both at 7.5 per­cent fol­lowed by Namibia at 6.7 per­cent, and South Africa at 6.3 per­cent, while Botswana con­tin­ued to record low in­fla­tion rate at 2.7 per­cent in June 2016,” reads the re­port. All mem­ber states con­tin­ued to record a sin­gle digit an­nual in­fla­tion rate dur­ing the month of June 2016.”

The re­port re­vealed Le­sotho’s in­fla­tion rate was mea­sured at 2.9 per­cent in June 2015.

“The ac­cel­er­a­tion in the an­nual in­fla­tion rate be­tween June 2015 and June 2016 was mainly re­flected in food and non-al­co­holic bev­er­ages (13.8 per­cent up from 4.7 per­cent in June 2015) that ac­counts for 38.1 per­cent of the over­all in­fla­tion bas­ket.”

SACU also noted the mem­ber states’ an­nual in­fla­tion rates con­tin­ued to be above the in­fla­tion tar­get range of three to six per­cent with the ex­cep­tion of Botswana.

The re­port at­trib­uted the in­fla­tion­ary pres­sure on food prices to the pre­vail­ing drought in the re­gion.

“For the month of June 2016 it was fur­ther ob­served that the food and non-al­co­holic bev­er­ages cat­e­gory con­tin­ued to reg­is­ter a dou­ble fig­ure in­fla­tion in mem­ber states with the ex­cep­tion of Botswana. The in­fla­tion­ary nary pres­sure in food prices can be at­trib­uted to the pre­vail­ing drought in the re­gion.”

SACU also so stated that by the end d of June 2016, the mone­tary pol­icy stancece in mem­ber states re­mained gen­er­ally ac­com­moda­tive with the e repo rate or bank ra­tee rang­ing be­tween six and seven per­cent. A repo rate is the rate at which the cen­tral bank k of a coun­try lends money y to com­mer­cial banks in thehe event of any short­fall of funds. It is used by mone­tary y au­thor­i­ties to con­trol in­fla­tion.tion.

“The mone­tary etary stance was un­al­tered be­tween etween May 2016 and June 2016 016 in all mem­ber states. Dur­ing ng the month of June, the high­est prime lend­ing rate was ob­served in Le­sotho at 11.69 per­cent, fol­loweded by Namibia at 10.75 per­cent, Southuth Africa at 10.5 per­cent, Swazi­land land at 10 10.55 per­cent per­cent, and Botswana at 7.5 per­cent.”

THE in­fla­tion rate is the level at which prices of goods and ser­vices is ris­ing.

Newspapers in English

Newspapers from Lesotho

© PressReader. All rights reserved.