THE annual rate of inflation has marginally decreased to 15.8 per cent in July, down from 15.9 per cent recorded in June, mainly induced by price decreases in food items, according to the Zambia Statistics Agency (ZSA).
Announcing Zambia’s annual rate of inflation for the month of July, ZSA Interim Statistician General Mulenga Musepa said the reduced inflation this month was largely attributable to decreased food prices.
“The year-on-year inflation rate as measured by the all items Consumer Price Index (CPI) for July, 2020, decreased to 15.8 per cent from 15.9 per cent recorded in June, 2020. This means that on average, prices of goods and services increased by 15.8 per cent between June, 2019, and July, 2020. The decrease in the annual rate of inflation was attributed to price decreases in food items,” Musepa told journalists via video conference in Lusaka, Thursday.
He said the decline in the annual food inflation rate, which dampened the overall annual rate of inflation, was largely driven by price reductions in mealie meal and vegetables.
“The year-on-year (annual) food inflation rate for July, 2020, was recorded at 16.1 per cent compared to 16.3 per cent recorded in June, 2020, indicating a decrease of 0.2 percentage points. This development was mainly attributed to reductions in prices of food items, such as cereals (Breakfast mealie meal, Roller meal, maize grain, samp) and vegetables (rape, tomatoes, cabbage, onion),” said Musepa.
“The year-on-year non-food inflation rate for July, 2020, was recorded at 15.4 per cent compared to 15.5 per cent recorded in June, 2020, indicating a decrease of 0.1 percentage points. This means that on average, prices of non-food items increased by 15.4 per cent between July, 2019, and July, 2020.”
Of the total 15.8 per cent annual inflation rate recorded this month, food and non-alcoholic beverages accounted for 8.6 percentage points, while non-food items accounted for 7.2 percentage points, according to Musepa.
ZSA data shows that Zambia’s annual rate of inflation of 15.8 per cent recorded in July, 2020, peaked to a near four-year high since September, 2016, when inflation was at 18.9 per cent, reducing to 12.5 per cent in October, 2016, before it dropped to close that year at 7.5 per cent.
The BoZ has projected that the country’s annual rate of inflation will remain high over the forecast period of eight quarters up to the end of next year, mainly driven by high food prices, but is due to slow down on the back of a maize bumper harvest produced this year.