Namibia’s annual inflation rate reached a five-year high of 7.3% in August compared to 3.4% recorded in August 2021, largely driven by increases in food, transport and non-alcoholic beverages.
The country last had a high annual inflation of 6.7% in April 2017. However, uncertainty caused by global geopolitics has seen prices rising rapidly since early this year.
Latest figures from the Namibia Statistics Agency (NSA) show that the highest change in the annual inflation rate were mainly witnessed in the categories of Transport (23.2%); Hotels, cafes, and restaurants (9.3%); Food and non-alcoholic beverages (8.8%); Furnishings, household equipment and routine maintenance of the house (8.6%); Alcoholic beverages and tobacco (5.2%) and Recreation and culture (5.1%).
“The annual percentage change for housing, water, electricity, gas, and other fuels components, which accounts for 28.4% of the consumer basket, increased by 2% during August 2022 compared to 1.6% registered during the same period of the preceding year.
The highest percentage changes in this category during August 2022 were mainly observed in the subcategories of Regular maintenance and repair of dwelling (8.5%); Electricity gas and other fuels; and Water supply, sewerage services and refuse collection recorded 3.9% each,” reads NSA’s latest update.
In economics, inflation refers to a general progressive increase in prices of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation corresponds to a reduction in the purchasing power of money. The opposite of inflation is deflation, a sustained decrease in the general price level of goods and services.
The statistics agency noted further that the cost of operating personal transport equipment increased by 35.4% in August 2022, compared to 10.3% recorded in August 2021. The increase resulted mainly from increases witnessed in the price levels of petrol and diesel, which recorded a hyperinflation rate of 63.1% in August 2022 compared to 16.4% registered during the same period last year.
Additionally, NSA says on a monthly basis, Namibia recorded an inflation rate of 0.3% compared to 1% a month earlier.
“The slight growth in the monthly inflation rate was driven by Furnishing household equipment and routine maintenance of the house which augmented by 0.9% compared to 0.4% recorded a month earlier and Health which recorded an inflation rate of 0.1% compared to a deflation of 0.2% registered last month,” NSA said
Meanwhile, the food and non-alcoholic beverages, which accounts for 22.5% of the National Consumer Price Index basket, recorded an inflation rate of 8.8% during the month of August 2022 compared to 7.2% registered during the same period of last year.
