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Headline inflation eases to 9.2%

Felix Mlusu

Headline inflation for April 2021 went down by 0.2 percentage points to 9.2 percent from 9.4 percent in March, thanks to easing maize prices, figures from the National Statistical Office (NSO) show.

This is the first time in five months for inflation to ease.

Inflation last dropped in November 2020 to 7.3 percent from 7.5 percent in October 2020.

According to the NSO figures, food and non-food inflation rates were seen at 11.5 and 7.0 percent, respectively, down from 11.7 and 6.9 percent, respectively.

The urban month-to-month inflation rate was seen at -2.4 percent while urban food and non-food inflation rates stand at -6.8 and 0.4 percent, respectively.

The rural month-to-month inflation rate is at -6.9 percent. Rural food and non-food inflation rates stand at -11.5 and 0.2 percent, respectively.

Experts have been pointing towards easing in inflation pleasure as the harvest season gets to the peak.

Finance Minister Felix Mlusu projected 2021 annual headline inflation at 7.4 percent, with December 2021 inflation projected at around 7.0 percent.

Figures he provided when presenting the mid-term budget statement to Parliament recently show that non-food inflation has been oscillating around 5.0 percent since the beginning of 2019.

In 2019, Reserve Bank of Malawi started implementing a three-year strategic plan in which it set an ambitious 5 percent inflation target to be achieved by the end of the first quarter of 2021.

In February last year, the central bank adopted what it calls a symmetric band of 2.0 percentage points around the point target of its inflation projection.

This means, when setting an inflation target, the central bank will aim at maintaining the rate within a range of plus or minus 2.

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