Malawi’s consumer prices grew at their slowest year-on-year pace since October in May, with CPI slowing to 22.6 percent from 23.9 percent in April, the National Statistics Office (NSO) in Zomba has said.
In the 2013/14 budget statement government expected that inflation would slow down to 14.2 percent by December 2013 and to seven percent by December 2014 arguing the economy was recovering.
In the wake of an aid freeze of about $150 million (about K60 billion ) in budget support by Malawi’s major donors in November last year, the Reserve Bank of Malawi (RBM) said it will tighten monetary policy to control inflation.
The central bank projected that inflation would settle at 23.1 percent in December 2013 and fall below 15 percent by June 2014 while the International Monetary Fund (IMF) targets single digit inflation by end this year.
The IMF after the completion of the third and fourth reviews of the Extended Credit Facility (ECF) urged authorities to continue with a tight monetary policy and fiscal restraint to stabilise the exchange rate and achieve the inflation target by end-2014.