Annual inflation rate dips to 4.9% in May, core inflation calculation introduced
The headline annual inflation rate for May 2024 marked a notable decrease, standing at 4.9% compared to 6.3% recorded in May 2023, according to the latest Namibia Consumer Price Index Bulletin, released by the Namibia Statistics Agency (NSA) on Thursday.
On a monthly basis, the inflation rate saw a slight uptick, increasing by 0.3% compared to 0.7% recorded in the previous month. The bulletin also provided insights into zonal inflation rates, revealing regional variations in inflationary pressures.
In May 2024, Zone 2, encompassing the Khomas region, recorded the highest annual inflation rate at 5.2 percent, followed closely by Zone 1, comprising Kavango East, Kavango West, Kunene, Ohangwena, Omusati, Oshana, Oshikoto, Otjozondjupa, and Zambezi regions, with an inflation rate of 5.1%. Zone 3, consisting of Kharas, Erongo, Hardap, and Omaheke regions, observed a comparatively lower annual inflation rate of 4%.
Further analysis of average retail prices for selected products highlighted regional disparities. Consumers in Zone 3 paid the highest price for Rooibos tea bags (200g) at N$34.99, followed by Zone 1 at N$31.98, while consumers in Zone 2 enjoyed the lowest price at N$31.88. Conversely, Zone 1 recorded the highest price for a 5kg bag of maize meal at N$69.66, followed by Zone 3 at N$68.77, with Zone 2 offering the lowest price at N$66.34.
In a significant development, the NSA announced the introduction of a core inflation calculation starting in April 2024. Core inflation excludes volatile elements such as food and energy prices from the overall inflation calculation, providing a more stable measure of inflation. In May 2024, the core inflation rate stood at 4.1%, slightly lower than the headline inflation rate of 4.9%, signalling a degree of stability in the economy.
The decline in the annual inflation rate coupled with the introduction of core inflation calculation reflects positive strides in Namibia’s economic management and policy frameworks, offering a glimpse of optimism for the future.
