Market food prices rise

The increase last week in fuel pump prices have led to increase in food prices, a mini survey conducted in various Kigali markets shows.Rice increased by Rwf400 for each grade. A kilo, which cost Rwf800 last week, now goes for Rwf1200, bananas rose to Rwf130 a kilo, from Rwf110. While Irish potatoes shot from Rwf190 a kilo to Rwf250, with tomatoes increasing by Rwf500 to Rwf3000 a bucket. Peas jumped to Rwf2000, up from Rwf1500 a kilo, while maize flour increased by Rwf100 from Rwf400. Oranges are at Rwf1000 from Rwf 800 while onions increased from Rwf600 to Rwf800. Prices of other commodities remain constant after a slight increase last year in November, with passion fruits declining to Rwf 800 from 1000. “I have no option but to fork out more money to buy food, because I cannot stop eating and this is already affecting my income,” Alexis Gabo, an electrician told Business Times.Traders say that the increase is as a result of the recent fuel hikes and predicted that more commodity prices are likely to go up.Analysts believe that price increase is likely to lower consumer’s purchasing power and trigger a rise in inflation levels currently at 7.85 percent that saw an increase from 7.81 in January this year.But the Governor of the central bank, Clever Gatete insists that the hike in food prices is not likely to cause any inflation as it is coming from the supply side and not demand side. “It shows that on the demand side, the money we are putting in the economy is not as much as what is coming from the food side,” he said recently.Last week, the National Institute of Statistics of Rwanda-NISR, announced that the country’s consumer price index for urban areas rose to 113.3 in February, with an increase of 1.04 percent up from 112.2 last month. Nevertheless, experts are hopeful that the country still has the capacity to swim over the global price volatility to keep the economy afloat if it accelerates its efforts to boost export receipts needed to bridge the current huge trade deficit. Trade deficit gap lingers at Rwf 62171 Million with exports receipts at Rwf 25,723 million (US$743.5m) trailing behind import receipts standing at Rwf 87,895 million (US$1.5bn) as at September 2011.