Malawi runaway inflation rises to 35.1 percent: Prices of consumer goods to continue climbing
Malawi’s headline inflation skyrocketed by 0.5 percent points in January to hit 35.1 in December as prices of food and non-food items continued to surge, the National Statistical Office (NSO) indicated .
The rise in inflation signals continued erosion in purchasing power by most average Malawians as both disposable income and savings are drastically reduced, throwing many into the ultra-poverty trap.
This also means consumers would continue to face tough times as prices for basic goods and services contained in the country’s Consumer Price Index (CPI)—measure that examines the weighted average of prices of a basket of consumer goods and services—are likely to continue climbing.
The Zomba-based statistical body from January 2013 rebased the Consumer Price Indices (CPI) using what they call updated household expenditure patterns derived from the 2010/2011 Integrated Household Survey.
The weight of food, according to CPI, has dwindled from 58.1 percent to 50.2 percent whereas housing, electricity and water come second at 12.6 percent.
Transportation is pegged at 11.7 percent; clothing and footwear at 5.9 percent, communication at 3.6 percent, miscellaneous at 3.9 while furnishing and household as well as education contribute 3 percent each.
Other contributors to the CPI are alcoholic drinks and tobacco at 2.4 percent; health, restaurants and hotels at 1.3 percent each whereas recreation and culture at 1.2 percent.
The May 7 devaluation of the kwacha by 49 percent and its flotation is also being blamed for the rise ininflation.
Consumers Association of Malawi (Cama) executive director John Kapito said the rise in inflation shows how much the devalued kwacha can bring in the home, pointing out that the rise in inflation “has created so much poverty.”
