Mozambique's Inflation Rate in 2006 Drops to 9.4%

By Eddyson Lugangwa Posted 08 January 2007 @ 01:37 pm EET     Print     Reprint     E-Mail     Comments

MAPUTO (IBTimes.com) - The Mozambican inflation rate, measured through the Maputo Consumer Price Index, dropped to 9.37 percent in 2006, compared to 11.15 percent in 2005.

Mozambican news agency (AIM) Saturday quoted Valeriano Levene, the deputy president for the economic department at the National Statistics Institute (INE), as saying inflation in December had been 2.07 percent, due to a sharp increase in food and drink prices.

The average price of tomatoes in Maputo was for the month of December 60.2 percent higher than in November, while live chicken rose in price by 10.3 per cent.
Levene said the government's target for 2006 inflation was 7.5 percent.

The pattern of price rises over the year was largely determined by the harvest, given the dominant role played by foodstuffs in the basket of goods and services used to calculate the consumer price index.

Prices rose quite sharply in the first four months of the year, with inflation reaching 6.02 percent by end of April. Then, as the harvest came in, prices dropped for the next four months. Inflation had fallen back to 3.96 percent by the end of August. Prices then rose again in the last third of the year, to reach a final inflation rate of 9.37 percent at the end of December.

Taking the year as a whole, food and drink was the main contributor to inflation, followed by the category of housing water, and fuel. Between them, the two categories accounted for almost the entire inflation rate (7.6 out of the 9.37 percent).

Food and drink prices rose by 10.37 percent, while the housing water and fuel category was up by 16.56 percent. In other significant areas, the price rises were much lower – the cost of transport was up by 2.59 percent, communications by 0.71 percent, and of clothing and footwear by 1.5 percent.