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Drop in inflation has no immediate impact on poverty reduction - Chulu

Drop in inflation has no immediate impact on poverty reduction - Chulu
By Kabanda Chulu
Monday December 03, 2007 [03:00]

Central Statistical Office (CSO) acting director Efreda Chulu has said the decline in inflation has no immediate impact on poverty reduction. And the monthly inflation rate has marginally decreased by 0.3 percentage points from 9.0 per cent in October 2007 to 8.7 per cent in November 2007. Recently, many people have accused the CSO of releasing information that does not relate to other economic indicators obtaining on the ground. But Chulu said people should not perceive that poverty levels would go down immediately as a result of the decline in the rate of inflation.

“People think that immediately we announce the findings of our surveys that it will automatically relate to poverty reduction but that is not the case since the rate of inflation is a measure of all consumer prices during a period of 12 months,” Chulu said.

“And it is true that some prices are increasing while others are not increased more often and also the rate at which prices of other commodities is reducing is increasing and when measuring inflation we put more weight on this aspect.”

And releasing the results of the monthly survey on consumer price index (CPI) last Friday, Chulu attributed the decrease in the rate of inflation to the decline in the food inflation products such as fish, Kapenta, fresh vegetables, fruits and milk products.

“The decline of a 0.3 percentage point in annual inflation rate from 9.0 per cent in October 2007 to 8.7 per cent in November 2007 is mainly due to relatively lower food prices recorded for the month of November 2007,” Chulu said.

“And of the total 8.7 per cent annual inflation rate, food products accounted for 2.5 percentage points while non-food products in the consumer price index (CPI) accounted for a total of 6.2 percentage points.”

She explained that annual food inflation rate was recorded at 5.2 per cent in November 2007 as compared to 5.6 per cent in October 2007.

“This means that food products registered lower prices in November 2007 compared to relatively higher prices recorded in November 2006,”said Chulu.

The Consumer Price Index (CPI) covers three series involving low-income groups that are low-income households in urban areas, high-income groups found in urban areas and non-income groups covering households in rural areas.

Labels: CPI, CSO, EFREDA CHULU, INFLATION, POVERTY

posted by MrK @ 6:02 AM