Prices fall: Third consecutive month of deflation – Mozambique

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Prices fall: Third consecutive month of deflation – Mozambique

10:35 CAT | 12 Aug 2019

File photo: Lusa

Prices continued to fall in July, according to the latest data from Mozambique’s National Statistics Institute (INE).

Based on the consumer price indices from the three largest cities (Maputo, Nampula and Beira), the INE announced that prices fell by 0.31 per cent in July. This was the third consecutive month of deflation, after price falls of 0.31 per cent in May and 0.23 per cent in June.

For the first seven months of the year, inflation was just 1.07 per cent. For the previous year (1 August 2018 to 31 July 2019) inflation was 2.16 per cent.

Variations in food prices are determinant in calculating the consumer price index, and hence the inflation rate. These months, the southern African winter, are normally months of low or negative inflation. The main harvest has come in, and so there is a glut of many crops.

The main price reductions in July were for garlic (minus 20.9 per cent), lettuce (minus 18.5 per cent), cabbage (minus 14.7 per cent), coconuts (minus 7.3 per cent), tomatoes (minus 6.7 per cent) and fresh fish (minus four per cent).

A few products rose in price, including cakes (10.9 per cent), dried prawns (6.7 per cent), cigarettes (1.3 per cent), and men’s trousers (1.3 per cent).

All three cities experienced deflation in July. Prices fell in Beira by 0.39 per cent, in Maputo by 0.36 per cent, and in Nampula by 0.12 per cent. Taking the past year as a whole, prices in Beira rose by 3.76 per cent, in Nampula by 3.52 per cent, and in Maputo by 0.98 per cent. The high price rises in Beira are likely to be caused by cyclone Idai which smashed into the city on 14 March.

Source: AIM