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October inflation eases to 8.3%

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The National Statistical Office (NSO) has reported that headline inflation for October 2017 now stands at 8.3 percent, a decline of 0.1 percent from the 8.4 percent registered in September.

The good tidings are mainly buoyed by availability of food following the bumper harvest.

Over the past few months, inflation has continued to decelerate, hitting single digit in August.

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According to the NSO figures, during the same period last year, inflation stood at 20.1 percent.

In the month under review, the urban and rural rates stood at 8.1 and 8.7 percent respectively.

Overall, food inflation stands at 4.8 percent from 5.1 percent in September 2017 while non-food inflation stands at 11.7 percent from 11.6 percent in September 2017.

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The Reserve Bank of Malawi (RBM) had already forecast that inflation would hit single digit before the end of the year.

In its recently published third quarter country report for Malawi, the Economic Intelligence Unit (EIU) said after averaging 23.2 percent over the previous five years, annual inflation is expected to fall to an average of 13.2 percent in 2017.

“This reflects a normalisation of domestic food prices after drought-related shortages in 2015- 16 and the appreciation of the real trade-weighted exchange rate,” EIU said.

The EIU projected Malawi’s headline inflation to continue falling, reaching seven percent by 2021 ‘assuming government’s continued commitment to relatively tight fiscal policy.’

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