Malawi’s inflation as measured by the Consumer Price Index (CPI) has hit a single digit of 9.3 percent, the first time in more than six years, National Statistical Office (NSO) figures show.
The Reserve Bank of Malawi (RBM) had forecast that the rate of inflation will hit a single digit by December this year largely due to easing prices of food, particularly maize.
This year, Malawi produced more than 30 percent surplus in maize owing to good climatic conditions after two successive years of low output due to drought and floods.
NSO figures released yesterday show that August inflation rate has eased by 0.9 percentage points from July’s 10.2 percent.
During the same period last year, inflation was at 22.8 percent, and this shows that prices of goods and services have increased at a much more reduced rate.
Reads the NSO Stats Flash: “The urban and rural rates stand at 8.9 percent and 9.8 percent , respectively. Overall, food inflation stands at 6.2 percent from 7.4 percent in July 2017 while non-food inflation stands at 12.2 percent from 12.7 percent in July 2017.”
The drop in inflation rate compelled the RBM to reduce the policy rate or bank rate from 22 percent to 18 percent in July this year.
Last month, RBM Governor Dalitso Kabambe said the central bank will continue with the tight monetary policy to maintain the trajectory taken by inflation and kwacha for the past 12 months.