Year-on-year inflation falls to 0,31pc

For February, Kenya’s inflation rate rose to 3,5 percent from 3,3 percent in January.

Business Reporter
The year-on-year inflation rate for June shed 0,43 percent to close the month at 0,31 percent on the May rate of 0,75 percent, according to the Zimbabwe National Statistics Agency.

This means that prices as measured by the all items Consumer Price Index increased by an average of 0,31 percent points between June 2016 and June 2017.

The year-on-year inflation rate is given by the percentage change in the index of the relevant month of the current year compared with the index of the same month in the previous year.

The latest developments in the year-on-year rate of inflation shows a slide towards negative territory as prices have continued to fall. Economics lecturer at Africa University Thomas Masese said the worsening cash crisis is dampening consumer demand and consumption of some products hence firms may be slowing the rate at which they review prices.

“The directive by authorities for price convergence between US dollar, bond cash and transfer prices may also be reducing some prices. However, it looks like the major contributor to inflation slowdown is depressed demand due to worsening liquidity crisis. Housing, water, electricity, gas and other fuels slowed down as landlords lower rentals. Food and non-alcoholic beverages also went down slightly as the price of maize meal has come down due to the increased availability after the bumper harvest.

“Most categories in the CPI basket went up hence the positive inflation of 0,31,” said Mr Masese. Zimbabwe’s annual inflation rate broke into positive territory for the first time in 29 months after gaining 0,71 percentage points on the January rate of -0,7 percent to 0,6 percent in February.

Inflation had entered deflation in February 2014 when the annual rate shed 0,9 percent to 0,49 percent. The year-on-year Food and Non Alcoholic beverages inflation prone to transitory shocks stood at 1,82 percent while the Non-food inflation rate was -0,37 percent. The month-on-month inflation rate in June 2017 was -0,24 percent shedding 0,27 percentage points on the May 2017 rate of 0,03 percent.

This means that prices as measured by the all items CPI decreased at an average rate of -0,24 percent from May to June 2017. The month-on-month inflation rate is given by the percentage change in the index of the relevant month of the current year compared with the index of the previous month in the current year.

The month-on-month Food and Non Alcoholic Beverages inflation rate stood at -0,45 percent in June 2017, shedding 0,52 percent on the May 2017 rate of 0,07 percent.

The month on month non-food inflation rate stood at -0,14 percent, shedding 0,15 percent points on the May 2017 rate of 0,01 percent. The CPI for the month ending June 2017 stood at 96,86 compared to 97,09 in May 2017 and 96,56 in June 2016.