Thursday, April 25, 2024

Consumer inflation slightly lower in September

Headline inflation for September declined to 4.5 percent from 4.6 percent recorded in August according to data from Statistics Botswana. The 0.1 percentage point decrease was mainly attributable to the Food & Non-Alcoholic beverages which reduced by 0.3 percentage points while the Alcoholic Beverages, Tobacco & Narcotics slowed by 0.2 percentage points. The Housing, Water, Electricity, Gas & Other Fuels which has the 3rd largest weight on the basket also decreased by 0.3 percentage points.

At the same time, the September national Consumer Price Index registered an increase of 0.2 percent, advancing from 177.5 in August to 177.8 in September. The rural villages’ index moved from 182.7 to 183.5, recording an increase of 0.4 percent. The urban villages’ index rose by 0.2 percent, from 176.3 to 176.6, while the cities and towns’ index advanced by 0.1 percent, from 176.3 to 176.4 between the two months.

Domestic inflation fell within the Bank’s objective range of 3 ÔÇô 6 percent in 2013 in the context of modest demand and the absence of upward pressures from changes in administered prices.┬á??Available data shows that the average national inflation rate decreased from 8.5 percent in 2011 to 7.5 percent by the end of 2012. Last year further steady progress was recorded, with inflation dropping to 4.8 percent as of October 2013.┬á??In January this year, the annual rate of the domestic inflation slightly went up by 0.3 of a percentage point from 4.1 percent in December last year to 4.4 percent. Latest data released last week shows that headline inflation fell from 4.6 percent in February 2014 to 4.4 percent in March. Inflation eased with respect to food and non-alcoholic beverages (from 3.5 to 3.2 percent); alcoholic beverages and tobacco (from 10.5 to 9.5 percent); and transport (from 1.9 to 1.1 percent).??The Bank of Botswana note on its Monetary Policy Statement for the year 2014 that its formulation and implementation of monetary policy will focus on entrenching expectations of low and sustainable inflation in the medium term, through timely responses to price developments, while ensuring that credit and other market developments are consistent with lasting stability of the financial system.┬á

Meanwhile Statistics Botswana said last week that it is considering revising the base year of two key economic indicators, the Gross Domestic Product (GDP) and the Consumer Price Index (CPI).

The last rebasing was done in 2011 when the agency changed the base year to 2006 from 1994.

Statistics Botswana executives explained then that the data changes were made to reflect trends in output and consumption in fast developing industries like mobile phones and the Internet.


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