Tuesday, March 5, 2024

Headline inflation soars to 10.6% in January

Consumer Inflation in Botswana which has been trending at nine-year highs since mid-2021 rose to 10.6 percent in January 2022, from 8.7 percent in December 2021, according to the latest Consumer Price Index (CPI) figures shared by Statistics Botswana this past week.

The upward movement has been directly linked to fuel prices hike which was approved by the energy regulatory body – BERA in the last week of December 2021.

According to Statistics Botswana, the rise in inflation between December 2021 and January 2022 also reflects an increase in public transport fares as reflected by the annual price changes for Transport (from 18.3 to 26.7 percent), and private school fees in January 2022. 

The Bank of Botswana says there has been partially offsetting movements in the annual price change for other categories of goods and services.  According to the SB data, annual price changes for the following categories of goods and services also increased: Restaurants and Hotels (from 4.4 to 5 percent); Miscellaneous Goods and Services (7.2 to 7.7 percent); Alcoholic Beverages and Tobacco (from 9.4 to 9.7 percent); Furnishing, Household Equipment and Routine Maintenance (from 5.1 to 5.2 percent); and Communication (from 1.1 to 1.2 percent). However, the upward pressure on inflation was partially offset by inflation falling with respect to: Education (from 2.8 to 2.2 percent); Health (from 2.9 to 2.6 percent); Food & Non-Alcoholic Beverages (from 7.2 to 7 percent); Clothing and Footwear (from 4.1 to 4 percent); Housing, Water, Electricity, Gas and Other Fuels (from 8.2 to 8.1 percent); and Recreation and Culture (from 4.1 to 4 percent).  

The 16 percent trimmed mean inflation increased from 8 percent to 8.8 percent between December 2021 and January 2022, while inflation excluding administered prices decreased from 7.1 percent to 6.7 percent, in the same period.

The country has experienced a spike in consumer prices since the beginning of 2021, with inflation averaging 6.7 percent in the second quarter of that year, higher than the 1.9 percent in the second quarter of 2020, largely caused by increases in levies and taxes, the upward adjustment in administered prices and associated second-round effects.


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