Inflation Drops To 11.9% On Moderating Food Prices

The National Bureau of Statistics (NBS) has said that the composite consumers price index CPI which measured inflation rate in the country fell to 11.9 per cent year-on-year as at February from the 12.6 per cent recorded in January.

The NBS which disclosed this recently in its CPI report for February said the current inflation rate was 0.7 per cent points lower than the figure attained in January.

The bureau attributed the slide in general prices of goods and services to a relative moderation in food prices, cost of transportation as compared to their prices as at January.

He said the partial removal of subsidy on petrol had pushed inflation rate in January and that the inflation rate would also determine the decision of the monetary policy committee (MPC).

The NBS explained that “the increase in hardline index composed of food indices was due to the partial petrol subsidy removal that pushed up prices of many food and non-food items including transport fare”.

The cost of transportation of food to markets which is merely a part of the transportation category in the CPI also increased and thus revealed the impact of the partial removal of subsidy on food prices.

However, the month-on-month charges of 0-3 per cent indicates a relative shift in price increases between January and February of this year as prices have been fully incorporated into producer costs.

Seasonal adjustments have also occurred as prices in the urban areas declined in February after higher spending in December which pushed food prices higher during that period.