The Bank of Zambia-BOZ has said that the general public should not mistake the slowdown in inflation to mean a reduction in commodity prices clarifying that inflation depicts the rate at which prices increase and not decrease.
BOZ Director Economics, Jonathan Chipili clarified that the current rate of inflation simply means that commodity prices will continue to rise but at a slower rate of 9.7% as opposed to a higher rate of increase at 24% last year.
Several stakeholders, people, businesses and online blogs have been questioning how commodity prices remain high with some continuing to rise while the country has reported reduced inflation from over 24 % last year to a single-digit rate of 9.7 for the month of June.
Mr Chipili said that the single-digit inflation rate towards the bank of Zambia’s target of 6 to 8 %, does not mean prices will go down but that with slowed-down inflation, prices will be rising at a more desirable rate as opposed to when inflation is high.
Mr Chipili added that the current inflation rate is attributable to the stable exchange rate, the reduced price of maize due to the country enjoying a surplus in production and the gains made by the kwacha, as well as the high supply of vegetables on the market.
Zambia’s inflation rate dropped below 10% for the first time in almost three years in June, against a global trend of record consumer-price growth.
Prices rose 9.7% from a year earlier, compared with 10.2%% in May, interim Statistician-General Mulenga Musepa told reporters Thursday in Lusaka, the capital. The last time the southern African nation’s inflation rate was under 10% was in August 2019. Annual food-price growth slowed to 11.9% in June, compared with 12.3% in the previous month, and non-food inflation decelerated to 6.9% from 7.5%. Costs climbed 0.9% in the month.
According to Bloomberg, inflation surged toward the end of 2020 and peaked at 24.6% in the middle of last year. The acceleration was largely driven by a sell-off of the kwacha and its dollar-denominated debt after Zambia became Africa’s first pandemic-era sovereign defaulter in November 2020.
Optimism over the nation’s economy since the election of Hakainde Hichilema as president in August, a potential debt restructuring and a $1.4 billion bailout package from the International Monetary Fund has seen a rally in the kwacha. That’s helped contain prices that are increasing due to supply-chain disruptions stemming from the war in Ukraine and intermittent Covid-19 lockdowns.
The kwacha has gained almost 33% against the dollar in the last 12 months, making it the second best-performing currency after the Russian ruble.
The sustained slowdown in inflation may give the monetary policy committee room to hold rates and aid the economy’s rebound when it meets in August. Last month, the central bank projected inflation will average 12.5% this year and will decline toward its target range of 6% to 8% by the end of 2023.
What economics is this Mr Chipili. You are now playing politics to please UPND. I am UPND but I don’t support this nonsense.
Don’t speak in tongues because we’ve been in this situation before during Penzanomics. Just say people ‘s buying power has been eroded. There are no longer queues at supermarkets. Many have even reduced the number of tellers from 12 to 2 or 1. Check Shoprite, Choppies, Pick n Pay and others. Even the excitement at Chipata Hungry Lion has waned. There’s no money and poverty prevalence levels have gone up
He is Dr. Jonathan Chipili. Not Mr., please!
Fuseke just be honest in telling the people that you have failed. This is why we fired kalyalya. Having fancy qualifications does not translate into effective competent performance. Your president then rehired some one who failed and you expect miracles haha
He’s wasting his time explaining considering 90% of the country doesnt understand finance
The country doesn’t understand liars
Why is LT not publishing many comments sent your on line publication? I’m starting to feel less encouraged,
Are you pf or upnd? Answer that question and you will know why
Matthew 10:21-23
“The paper the researchers published says that the Borealis quantum chip took only 36 microseconds to solve a problem that would take supercomputers and algorithms 9,000 years to figure out.“
At the rate we are going if we are not careful GRZ is going be be for GRZ people only.
Taxation without representation.
“The paper the researchers published says that the Borealis quantum chip took only 36 microseconds to solve a problem that would take supercomputers and algorithms 9,000 years to figure out.“
At the rate we are going if we are not careful GRZ is going be be for GRZ people only.
Taxation without representation.
Took only 36 microseconds to solve a problem that would take supercomputers and algorithms 9,000 years to figure out.
At the rate we are going if we are not careful GRZ is going be be for GRZ people only.
Taxation without representation.
Bank of Zambia fake economists……
The whole world is having rising inflation. Look at USA, UK, JAPAN, SOUTH AFRICA, FRANCE, INDIA……they are all raising flags about rising inflation and rising cost of commodities. Only in Zambia …..where inflation is reducing but cost of goods going up…….hahahaha.
Inflation is reducing because of vegetables at Soweto market……kikikikik.
Trying to fake figures to impress the IMF…….
The truth is on the ground. There is no money Mr. Chipili. People are suffering with hunger. Your inflation figures are fake!!!
A year ago we were given a lecture on how to reduce the cost of fuel…..It was a fake lecture that cannot be implemented. We have seen the cost fuel contineously going up.
We were promised that inflation will come down….It has not happened . So you have resorted to faking figures. We are not dull
@Ayatollah
Lets simply say there is no more government money freely flowing. All the holes have been plugged. During Lung it was free for all. Early this year I past thru East Park in the night most bars were either half empty or simply deserted .
Disraeli put it better: THERE ARE 3 KINDS OF LIES – LIES! DAMNED LIES! AND STATISTICS
The BOZ man has added another:OFFICIAL UBUFI
Why is inflation not going up in order to come down? According to the VPs economic theory.!
Ama Economists ba ku BOZ……kaya!! There is no way bwana that Zambia’s inflation can get to single DG when we all know this inflation is GLOBAL!!
THE BIGGEST INFLATED LIE ON THE GLOBE !
Who are we cheating? We can all see how expensive fuel is. We can see that sugar is racing towards K50/2kg. We can see that cooking oil is getting closer to K300/5litre. We can see a loaf of bread is heading towardsK20/loaf. Talk about beef? Dry fish? Kapenta? Its up up up. And country’s bank can come up with such a big lie sure? May be we need Fundanga back at the BOZ. Or even micheal Jackson may be.
Bufi
My name sake is very intelligent economist may be the explanation could be The Cost of Long adjustments or CLA and also to address this the inflation measures could be more explained beyond the basic CPI covering to close the gaps and let people relate it’s like the central bank investing into inflation linked bonds and tracking performance similarly individuals would want to know the cost of living adjustment if inflation reduces but the risk is skewed to the downside and people should relate due to global contagion
The emphasis should be on what the nuetral rate should be because some inflation is okay but too much or enough or two little you move into stagflation recession or asvit inflation You need also to know the transition wether you are in transition to the neutral or have reached and what policy’s measures you need to to ensure the economy performs Now monetary policy is effectively being implemented better than the fiscal to spur productivity and Economic progress because of its immediate time lag without adding baby significant costs to the economy but there is more to be done on the final productivity if inflation will moderate for long-term because risks abound