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Staff Reporter
WINDHOEK – The Statistical Agency of Namibia released the Consumer Price Index (CPI) for June 2018, indicating that the rate of Inflation continued its rise, rising from 3.8% in May to 4.0% in June 2018 compared to a year ago. This tick on the rise reflects the strongest price hikes so far this year, but the inflation rate remains below the annual inflation rate in June 2017 which was 6.1% . From one month to the next, inflation slowed from 0.4% in May (compared to April) to 0.2% in June 2018 (compared to May). The CPI is used to calculate the monthly inflation rates (compared to the previous month) and from one year to the next (compared to the same month of the previous year ).
"Inflation continues its upward trajectory, but we expect a stronger increase in transport inflation, and therefore overall inflation, as fuel prices in Windhoek have Increased by an average of 14.5% in June 2018 compared to June 2017. The price of fuel will increase in July put more upward pressure on the inflation rate.The rise in fuel prices will also affect the costs of production and, if it continues, will result in second-round effects and price increases for fuel-sensitive goods, "commented Klaus Schade, research associate at EAN. 19659003] There added that EAN expects the inflation rate for bread and cereals to continue to increase mainly due to the weak base effect since May 2017, when bread and cereals began to drop. "On the other side better grazing conditions could lead to a further slowdown in meat prices. Schade
Excerpts of the annual inflation rates for June 2018 show that goods prices rose by 3.8% in June compared to 3.6% in May 2018. It is a question of the fastest increase since June 2017, when property prices rose 4.5%. In contrast, prices for services increased at the same pace in June 2018 as in May, at 4.2%, the smallest increase since December 2015, when service prices rose 3.1%. %.
Prices for food and non-alcoholic beverages increased at a slightly slower pace of 3.8% in June, compared to 3.9% in May 2018. However, prices remained the largest increase since September 2017, when prices were increased by 4.2%. The slightly lower increase in this category was caused by a slowdown in food price increases from 4.1% in May to 4.0% in June. The rise in prices for bread and cereals accelerated by 3.1% against 2.3% in May and a contraction of prices in the previous months since April 2017. In contrast, price increases in meat decelerated in June 2017 by 6.9% vs. 8.5% May, which is the slowest price increase for meat products since November 2016, when prices rose 4.4%.
Bread, cereals and meat account for more than 50% of food and therefore have a significant impact on price inflation. The rise in fruit prices remains strong, at 12.4%, although slightly lower than in May (12.6%). Vegetable prices have seen the strongest growth with 6.1% since January 2017.
Although higher than in May, inflation in milk, cheese and eggs remained the highest low since June 2012 with a price decrease of 1.0%. Milk prices, etc., rose 0.8% in June 2018 compared to 0.2% in May.
Price changes in the "food and non-alcoholic beverages" category have a significant impact on the overall inflation rate since the percent category of the consumption basket – the basket that contains all goods and services consumed by the Namibians.
Higher prices for housing, water and electricity – items accounting for the largest portion of the consumption basket (28.4%) of 3.3 per cent in May 3.2 percent in June 2018. This is the lowest inflation rate in this category so far this year, with the exception of February which recorded the same rate . The slight decrease in price increases is due to lower prices for the maintenance and repair of buildings (2.3% in June compared to 2.6% in May) and electricity and electricity. gas (4.9% in June against 5.5% in May). 19659003] Price increases for rents (2.6%) and for water and sanitation (7.2%) remained the same as in May while price increases transport accelerated to 7.2% in June against 5.6% in May and reached their highest level since July. 2014 when they grew 8.5 percent. The rise in transportation inflation was caused by increases in oil and diesel prices which pushed the vehicle operating inflation rate from 6.2% in May to 8.9% in June. This subcategory of transportation accounts for 63% of the "transportation" category and therefore has a strong impact on the transport rate of inflation. In addition, it influences the overall rate of inflation, since the operation of vehicles contributes nearly 9% to the overall inflation rate.
Alcohol and tobacco prices rose slightly in June (5.1%) mainly due to lower prices for alcoholic beverages (5.3% in June compared to 6.2% in may). In contrast, the inflation rate for tobacco products has almost doubled, from 2.1% in May to 4.1% in June, the highest inflation rate this year.
Prices for clothing and footwear have been trending downward. They fell 5.8% in June against a 5.5% decline in May. Prices in both clothing and footwear declined by 6.2% and 5.0%, respectively.
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