Most advanced and emerging economies have experienced heightened inflationary pressure amid rising commodity prices, according to the Reserve Bank of Malawi, a development which could affect domestic inflation as Malawi is a net importer.
In its latest Intelligence Market Report, the RBM said other commodities such as crude vegetable oils, wheat and fertilisers recorded notable price increases denoting that the risk of new spikes in commodity prices still lingers.
Reads the report in part: “Inflation took a surprise upward turn for most of the sampled advanced and emerging economies as these economies experienced an uptick in inflation.”
These developments come after Malawi’s inflation rate is slowly turning the corner, easing to 32.4 percent in October from 34.3 percent in September, largely due to the drop in food inflation.
Consumers Association of Malawi executive director John Kapito said in an interview on Tuesday that fresh pressure is bound to worsen the situation.
“Our market inspections have shown that prices of most goods on the market have gone up by an average of 50 percent while transport costs have gone up by 70 percent,” he said.
Malawi Congress of Trade Unions president Charles Kunchenga has urged employers, including the Malawi Government, to be proactive on cost of living adjustments for their employees.
He said: “This will be detrimental to our economy as wages have not risen for some time and this may erode any economic gains for wages that were revised.
“For workers in the informal economy, it will be worse considering that social dialogue platforms do not exist.”
Economists have been advising authorities to intensify maize distribution to ease pressure on food prices.
Food accounts for more than half of the consumer price index, an aggregate basket for computing inflation.
