Inflation turned to deflation in May – AIM report

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Inflation turned to deflation in May – AIM report

12:10 CAT | 12 Jun 2019

in file CoM

Inflation has turned to deflation in Mozambique, as prices fell slightly in the main cities during May.

According to the latest figures from the National Statistics Institute (INE), based on the consumer price indices of the three largest cities (Maputo, Nampula and Beira), inflation in May was minus 0.31 per cent.

Inflation for the first five months of the year was just 1.61 per cent, while the annual inflation (1 June 2018 to 31 May 2019) was 2.42 per cent.

The main price falls in May were for cabbage (a decline of 14.9 per cent), coconuts (9.6 per cent), tomatoes (eight per cent), charcoal (5.6 per cent), dried fish (2.6 per cent), fresh fish (1.7 per cent), and petrol (1.4 per cent).

There were several price increases over the month, notably for bread (6.2 per cent), maize flour (3.9 per cent), onions (1.9 per cent) and restaurant meals (0.9 per cent).

May was the first month in which prices fell since July 2018. The annual inflation figure has been dropping for the last two years. In May 2017, annual inflation was 20.45 per cent. A year later it was 3.26 per cent, and now it is down to 2.42 per cent.

There are variations between the three cities. The highest inflation in May was recorded in Nampula at 0.72 per cent, and the lowest in Beira, at minus 1.91 per cent. In Maputo, inflation was minus 0.25 per cent.

But in the five month period since the beginning of the year, Beira had the highest inflation at 3.19 per cent, followed by Nampula (1.59 per cent) and Maputo (1.09 per cent). The higher inflation in Beira was doubtless in part due to the battering the city took from cyclone Idai, which ravaged it on 14 March.

Source: AIM