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Malawi’s inflation rate down to 20.1%

 

For three months in a row, Malawi’s year-on-year headline inflation rate continues to decline with the October rate down to 20.1 percent, thanks to a drop in food prices.

Inflation rate fell 1.1 percentage points from last month’s 21.2 percent on account of declining food inflation, which slowed to 25.4 percent from 27 percent in September, according to National Statistical office (NSO).

On the other hand, non-food inflation declined by 0.7 percentage points to 15.2 percent from 15.9 percent recorded last month.

In October last year, inflation rate was 24.7 percent.

Ree: Bring down inflation rate
Ree: Bring down inflation rate

With the latest figures, it means inflation rate is now 0.1 percentage points below the annual target of 21 percent set by the Reserve Bank of Malawi (RBM) in January and 5.3 percentage points below the revised annual target of 25.4 percent set in the fourth monetary policy statement in August.

Maize is the main driver of Malawi’s inflation. In recent times, the price of maize has continued to go down on the market.

On October 24, State produce trader Agricultural Development and Marketing Corporation (Admarc) opened its markets nationwide and there has been no scramble for the staple grain as has been the case in previous years.

Admarc is selling maize at K250 per kilogramme (kg), translating to K12 500 per 50kg bag.

This year, Malawi recorded a 12.4 percent maize deficit as compared to last year due to El Niño-induced drought that hit the country.

However, the deficit is being supplemented by maize purchases from within and outside.

In a recent interview, International Monetary Fund (IMF) resident representative Jack Ree said there is need to bring down inflation if Malawi’s economy is to get back on track. n

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