Statistics bureau puts Inflation rate at 12% in December

Consumer Price Index rose to 12 per cent in December.

The National Bureau of Statistics, NBS, has said that Composite Consumer PRICE index, CPI, which captures the prevailing inflation rate in the country, recorded a marginal rise in December to about 12 per cent on a year-on-year basis from 12.3 per cent in the preceding month.

The statistics bureau said in its latest CPI report published on Thursday that the analysis of the data on month-on-month basis reveals that the composite CPI is lower than the previous month’s rate by about 0.30 per cent when compared with the preceding month’s index.

The agency attributed the relative increase in the headline index during the month under review to higher prices in the core Index, one of the key components that make up the country’s headline inflation rate.

According to the Bureau, December’s inflation rate reflected the second consecutive month in which the core index deviated from the downward trend it exhibited since last July, when it increased to 13.7 per cent from 13.1 in November.

On the other hand, the NBS reported that food prices moderated during the month under review, giving temporary respite from the devastating impacts of the floods that affected parts of the country between July and mid-October, as well as other demand and supply conditions.

The NBS said the food index increased on year-on-year basis to about 10.2 per cent from 11.6 per cent it rose to in the preceding month.

A further analysis of the CPI on urban-rural basis showed urban inflation rate at about 14.5 per cent on year-on-year basis, reflecting a decrease of 1.3 percentage points from the 15.8 per cent recorded in November, while the rural inflation index increased marginally by 0.4 percentage points to 10.2 per cent on a year-on-year basis.

Further analysis of the trend revealed that on a month-on-month basis, the urban all-item index increased by 0.8 per cent from levels recorded in November, while the rural all-Items index increased by 0.7 per cent between November and December, with the percentage change in the average composite CPI for the 12-month period ending December 2012 over the average of the CPI for the previous 12-month period was recorded at 12.2 percent.

On the composite food Index, it was reported that the index “increased on year-on-year basis by 10.2 per cent to 11.2 points, representing 1.4 percentage points higher than 11.6

percent recorded in November, while also increasing by 1.0 per cent from November to December on a month-on-month basis.

“All items less Farm Produce” index, which excludes the prices of volatile agricultural products, rose by 13.7 per cent on year-on-year basis, indicating 0.6 percentage points higher than the 13.1 per cent recorded in November,” the NBS said.

“On month-on-month basis, the core index increased by 0.7 per cent from levels recorded the preceding month,” it added.

The NBS pointed out that the increases in the core index were as a result of increases in the housing, electricity, natural gas and other fuels division, particularly liquids (household kerosene), solid fuels (firewood and charcoal) rental and imputed rent prices, clothing prices, garment prices, and air transport fares.

“On month-on-month basis, the Core index increased by 0.4 percent in November, unchanged from October. The average 12 month annual rate of rise of the index was recorded at 13.6 percent (year-on-year) for the twelve-month period ending November 2012,” the NBS said in the report.