The Central Statistics Office (CSO) has attributed the decrease in the annual rate of inflation to the base effect which emerged from the adjustment in electricity tariffs in June 2017.This simply means that the drop is as a result of last years 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 has said the year on year inflation rate as measured by the all items Consumer Price Index (CPI) for June 2018 decreased to 7.4 percent compared to 7.8 percent recorded in May 2018.
“This means that an average, prices of goods and services increased by 7.4 percent between June 2017 and June 2018,” he said. He started that the increase in the annual food inflation rate is mainly as a result of price changes of a 20 litre tin of Maize grain and a 2 kg Packet of Sugar. The year on year (Annual) no -food inflation rate for June 2018 was recorded at 7.3 percent from 8.9 percent as of May 2018, indicating a decrease of 1.6 percentage points.
He further indicated that the monthly inflation for June 2018, was recorded at 0.2 percent compared to 0.4 percent recorded in May 2018, showing a decrease of 0.2 percentage points. “The monthly food inflation rate for June 2018 decreased to 0.3 percent compared to 4.0 percent recorded in May 2018. 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 macro economic fundamentals that include the exchange rate have relatively stabilized following the pick up of global copper prices which are now crossed the USD7,000 per tonne. Copper remains Zambia’s key export earner contributing to over 70% of total country exports. Efforts to diversify the economy has always been sung when the prices drop and are currently muted relative to the two years ago when the copper prices tanked.