The annual inflation rate for November 2016 has reversed to a single digit standing at 8.8% compared to 19.5% in November 2015.
Director of Census and Statistics John Kalumbi says this means that on average prices increased by 8.8% between November 2015 and November 2016.
Mr. Kalumbi clarified that the decrease in the annual inflation rate does not mean a fall in the prices of goods and services.
He said this during the release of the November 2016 statistics monthly bulletin.
The year on year inflation rate as measured by the ‘all items consumer price index’ in November has shed 3.7% on the October 2016 rate of 12.5 percent.
The monthly rate of inflation has however increased to 1.5% in November 2016 from 0.5% in October 2016.
total madness Kalumbi.Any statistics that do not translate into tangiable goods and services being available and to lower prices is meaningless.Zambian are more poor now than ever.
Grade 8 fimo-fimo: inflation is too much money chasing too few goods & deflation is: too little money chasing many goods.
At Jacaranda mall in Ndola shops are closing every day. How does one of the longest serving directors at CSO factor this in his jargon.
Maybe he can also talk about disinflation. I just want to learn.
I don’t understand the explanation of single digits. In 2014 the mealie meal was K35 and the currency was double digits.
What is the benefit of single digits today when the mealie meal is K97?
Your question is not clear and your data is wrong. If you imply that in 2014 mealie meal was K35 and the inflation was double digits. You have to understand inflation by its formal definition, and how the inflation rate is calculated in Zambia. Inflation is the generally or aggregate a sustained average increase in prices of goods and services for a definite period of time. Meaning that it’s the rate at which ‘all’ prices are increasing (Caution, not all prices will be increasing within that period. e.g. Cement prices dropped when Dangote entered the market.) Also the commodity Mealie meal is just but one item that is considered of the thousands of items that affect the ‘general’ price increase called inflation. E.g. fuel prices and others significantly went up last month but other…
but other prices remained constant, while others even decreased. The net impact of fuel prices on the general price increase was not significant. Similarly this was not greater the year to year trend of inflation rate.
To simplify your question the mealie meal may have been K35 in 2014 and the inflation rate was double digits. (Meaning anything above 10.00000001) that was the rate that covered generally all goods and services, mealie meal inclusive. Likewise the mealie meal prices have been increasing from K35 as you put it to K95. Until last month when the rate dropped to 8.8%. Simply put 8.8 % covers all prices but 40% increase in fuel prices covered only one commodity.
Also understand the nature of the commodity mealie meal which is produced using maize, I highly subsidized product…
Also understand the nature of the commodity mealie meal which is produced using maize, I highly subsidized product (fertilizer and seed) which breeds its own inefficiencies in terms of pricing.
the biggest problem with us in this country is lack of basic understanding: if a bag of mealie meal last year was K100 and this year it is K150, inflation is 50%. of next year the price becomes K165, inflation is said to be 10%. Inflation has always been positive in this country, this means a reduction in inflation does not been a reduction in prices neither does it mean prices will not go up BUT it means prices will not change much. hope this will make sense
Honest. I like your explanation.
Inflation is the difference between CPI (consumer price index) this month (Nov 2016) and CPI last year same month (Nov 2015). The Nov 2015 CPI was 172 and the Nov 2016 CPI was 187, therefore the 8.8% increase they are giving you. The issue though is that the Nov 2016 CPI of 187 isn’t that true value. I believe the central statistics are lowering the number because they must be deliberately not factoring in the spiral effect of increase in pump price of fuel (40% increase). If we consider the 40% increase in fuel, the projected CPI for Nov 2016 should be approximately more than 195 (using linear approximation) as the increase in fuel will also increase the price of ‘fixed’ basket of good. This is pretty much an artificial inflation value they are providing us not the real value!
Great analysis, my take is that the spiral effect takes more time to fully take effect and significantly change the numbers. The understanding of time series data in terms of the ‘inertia phenomenon’ will clear this aspect. when inflation rate ‘suddenly’ increases it exaggerates the rate of increase like wise when its reducing. The Sluggishness does not mean data is being manipulated hence we have ‘artificial inflation rates’, i dont think so.
Fuel price increased by 40% but inflation is single digits?
Please do not take Zambians for complete fills!
This man is just vomiting PF propaganda and LIES! We know the real rate of inflation. We FEEL it! .No free fuel for us like these Minister thieves.
This is an artificial inflation rate they are giving us.pamafi party and Vodka Chakolwa Rungu are just a bunch of thieves, drunkards,murderers,hypocrites..
What he means is that the general prices are still increasing/rising but now at a slower rate of 8.8% as compared to the 12.5% of last month. What everyone is expecting is deflation, ‘the falling prices’, sad to say this rarely happens in economies like ours.
This is about to go over Cadre’s heads kikiki