The monthly inflation rate for August 2020 stood at 0.4%, which is an increase of 0.2 percentage points when compared to 0.2% recorded during July 2020. On annual inflation, August rates declined to 2.4% from 3.7% recorded in August 2019, which is a decrease of 1.3 percentage points.
This is according to the Namibia Consumer Price Index (NCPI), which was released by the Namibia Statistics Agency (NSA) yesterday.
Statistician General and CEO of the NSA Alex Shimuafeni said the slowdown in the annual inflation rate between August 2019 and August 2020 resulted mainly from decreases in prices reflected in the categories of housing, water, electricity, gas and other fuels.
“The above categories account for 28.4% of the overall basket of NCPI and their prices declined by -1.5%, compared to an increase of 1.9% recorded in August 2019,” he said.
Prices of transport, which account for 14.28% of the overall basket of NCPI, also reflected a slowdown by increasing by 1.2% in August 2020, compared to 6.1% in August 2019. Other categories that contributed to the slow growth of the annual inflation rate were the education that increased by 7%, compared to 12% recorded in August 2019 – and clothing and footwear that declined by -5.1%, compared to an increase of 1.6% in August 2019.
Shimuafeni added that the zonal inflation rates for August 2020 revealed that zone one, which constitutes Kavango East, Kavango West, Kunene, Ohangwena, Omusati, Oshana, Oshikoto, Otjozondjupa and the Zambezi recorded an annual inflation rate of 2.5%. While in Zone 2 (Khomas), the annual inflation rate was estimated at 2.9%. Zone 3 (//Kharas, Erongo, Hardap, and Omaheke) registered the lowest annual inflation rate of 1.5% among the three zones.
Monthly, zone one and two both recorded an inflation rate of 0.5%, while the Zone 3 monthly inflation rate stood at 0.2%.
“Zone three annual inflation rate slowed to 1.5% in August 2020 from 4.9% recorded in August 2019. The decline in inflation was mainly from decreases recorded in all the groups, except for recreation and culture, which increased from 2.3% to 3.6% and miscellaneous goods services from 3.1% to 3.3%. Communications remained unchanged at 1.8%. On a monthly basis, the inflation rate for August 2020 stood at 0.2%, compared to 0.0% recorded last month,” explains Shimuafeni.
The statistician general stated the inflation rate is vital for purposes of economic policy-making, especially the conduct of monetary policy and to consumers in general.
“It is further used in a wide variety of public and private contracts for the purposes of adjusting payments (such as wages, rents, interest and social security benefits). It, therefore, has substantial and wide-ranging financial implications for governments and businesses, as well as for households,” he said.