The Zambian Central Statistical Office (CSO) indicates that the annual rate of inflation in August 2016 decreased to 19.6%, from 20.2% in July 2016.
The decrease in the annual rate of inflation was mainly attributed to decreases in food prices. The annual food inflation rate for August 2016 was 24.1% compared to 24.8% July 2016.
The decrease in food inflation was mainly attributed to decreases in the prices of samp, local rice, cassava meal, rape vegetables, sorghum, frozen fish, dried bream, and dried kapenta (chisense).
The annual non-food inflation rate for August 2016 fell to 14.8% from 15.3% in July 2016 thanks to decreases in prices of charcoal, motor vehicles and bicycles.
Zambia’s annual rate of inflation also decreased for alcoholic beverages and tobacco, housing, water, electricity, gas and other fuels, furnishings, household equipment, routine house maintenance, and transport.
According to the CSO, food and non-alcoholic beverage products accounted for 12.4% of the total 19.6% annual inflation rate in August 2016, while non-food products accounted for 7.2%.
Zambia’s inflation rate almost tripled in the past year, increasing from 7.7% in September 2015 to 22.9% in February 2016.
This is why the Bank of Zambia (BOZ) decided to raise the reference interest rate from 12.5% to 15.5% in November 2015 on an attempt to halt the country’s increasing inflation rate.
According to Trading Economics, annual inflation in Zambia is forecasted to reach 13.7% by 2020.
