Rising food prices occasioned by a deficit in the staple crop maize continue to push up year-on-year inflation, a monster that eats people’s disposable incomes.
Inflation, as measured by consumer price index (CPI), jumped 0.9 percentage points to 22.2 percent in July 2015 from 21.3 percent the month before, figures from the National Statistical Office (NSO) show.
Malawi’s inflation is mainly driven by the availability or absence of food, which has a weight of 50.2 percent in the CPI.
This year, Malawi has recorded a 30.2 percent deficit in maize output, according to figures from Ministry of Agriculture, Irrigation and Water Development.
The rise in inflation is contrary to expectations by Minister of Finance, Economic Planning and Development Goodall Gondwe who earlier predicted that inflation rate is projected to decline to 16.4 percent during the 2015/16 fiscal year.