CPI Rises to 9.3% in August'15; Driven by Slower Increases in Alcoholic Beverages


Sunday, September 13, 2015 7:07PM /National Bureau of Statistics

In August, the Consumer Price Index (CPI) which measures inflation edged higher to 9.3% (year-on-year), from 9.2% in July. The marginal increase was as a result of slower increases in Alcoholic Beverages, Tobacco and Kola; Health, Transport; and Recreation and Culture Divisions. On a month-on-month basis, the pace of increases of food prices as reflected by the Food Sub-index has slowed, contributing to the relatively slower pace of increases reflected on the year-on-year rates between July and August.

The Food Sub-index rose by 10.1% (year-on-year) in August, slightly higher from 10.0% in July. While increases were observed in major groups within the index: Bread and Cereals, Meats and Fish, the index was weighted upon by a slower increase in the Fruit, Vegetables, and Potatoes, Yams and Other Tubers groups.

The advances recorded by the “All Items less Farm Produce” or Core subindex increased at a faster pace in August relative to July. The Core Subindex increased by 9.0% in August (year-on-year), 0.2 %points from 8.8% in July. Of the COICOP divisions that contribute to the Core sub-index, the largest pressures were recorded in the Housing Water, Electricity, Gas and Other Fuels; Education, Restaurants and Hotels; and Miscellaneous Goods and Services divisions. The pace of increases slowed in the Health, Transportation, and Recreation and Culture divisions, however.

The percentage change in the average composite CPI for the twelvemonth period ending in August over the average of the CPI for the previous twelve-month period was 8.6 percent, marginally higher from the 8.5percent rate recorded in July. The corresponding twelve-month year-onyear average percentage change for the Urban index increased marginally from 8.5% to 8.6%, while the corresponding Rural index also edged higher to 8.5% in August from 8.4 percent in July.

It should be noted that the Headline Index is made up of the Core Index and Farm Produce items. As Processed Foods are included in both the Core and Food sub-indices, this implies that these sub-indices are not mutually-exclusive.

On a month-on-month basis, the pace of the increase in the Headline index eased for the third consecutive month. The Headline index increased by 0.6% in August, marginally lower from 0.7% in July. The Headline index increased at a slower rate as all COICOP divisions slowed during the period with the exceptions being Furnishings & Household Equipment Maintenance; Education and Restaurant and Hotels Divisions.

The Urban index increased by 9.2 percent (year-on-year), increasing at the same pace for three consecutive months, while the Rural index increased 0.2% points to 9.4%, from 9.2% in July. On a month-on-month basis, both the Urban and Rural indices increased at a slower pace,increasing by 0.6% in August. The Urban and Rural indices both grew by 0.7% in July.

In August, Food prices increased at a marginally higher pace relative to July. Food prices as observed by the Food Sub-index increased by 10.1%, as prices of, Fruits, Vegetables; and Potatoes, Yams and Tubers groups grew at a slower pace and weighed on the index. All three group indices increased at a slower pace for the second consecutive month. Imported food prices however remain high. On a month-on-month basis, the Food Sub-index increased at a slower pace for the second consecutive month in August, increasing by 0.6% from 0.8% in July. All groups which contribute to the Food Sub-index increased at a slower rate in July with the exceptions being the Eggs, Milk and Cheese; and the Oils and Fats groups. The average annual rate of change of the Food Sub-index for the twelve-month period ending in August 2015 over the previous twelve month average was 9.6 percent, holding at the same rate for two consecutive months.

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