Base ef­fects slow June an­nual in­fla­tion to 7.4%

Zambian Business Times - - BUSINESS REVIEW -

Zam­bia’s June an­nual in­fla­tion slowed 40bps to 7.4% as an­nounced by the Cen­tral Statis­tics Of­fice - CSO. The CSO at­trib­uted the de­crease in the an­nual in­fla­tion rate to base ef­fects which emerged from the ad­just­ment in elec­tric­ity tar­iffs in June 2017.This sim­ply means that the drop is as a re­sult of last year’s elec­tric­ity price in­crease whose ef­fect has now flat­tened on the year on year time se­ries com­par­isons.

CSO Act­ing Di­rec­tor of Cen­sus and Statis­tics Good­son Sinyenga said the year on year in­fla­tion rate as mea­sured by the all items con­sumer Price In­dex (CPI) for June 2018 de­creased to 7.4% com­pared to 7.8% recorded in May 2018.

“This means that on av­er­age, prices of goods and ser­vices in­creased by 7.4% be­tween June 2017 and June 2018,” he said. He stated that the in­crease in the an­nual food in­fla­tion rate is mainly as a re­sult of price changes in maize and sugar. The year on year non-food in­fla­tion rate for June 2018 was recorded at 7.3% from 8.9% as at May 2018, in­di­cat­ing a de­crease of 1.6%.

He fur­ther in­di­cated that the monthly in­fla­tion for June 2018, was recorded at 0.2% com­pared to 0.4% recorded in May, rep­re­sent­ing a de­crease of 0.2%.

“The monthly food in­fla­tion rate for June 2018 de­creased to 0.3% com­pared to 4% recorded in May. The de­crease in the monthly food in­fla­tion rate is mainly as a re­sult of price changes for bread ce­re­als food items such has cas­sava meal, buka buka, dried Si­avonga kapenta,” He said.

Zam­bia’s macroe­co­nomic fun­da­men­tals that in­clude the ex­change rate have rel­a­tively sta­bi­lized fol­low­ing the rise in global cop­per prices which have crossed the USD7,000 per tonne mark. Cop­per re­mains Zam­bia’s key ex­port earner con­tribut­ing over 70% of to­tal coun­try ex­ports. Ef­forts to di­ver­sify the econ­omy have al­ways been echoed when red metal prices de­cline and are cur­rently muted relative to the two years ago when the cop­per prices crested.

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