Consumers are set to enjoy cheaper prices on the market after the National Institute of Statistics of Rwanda (NISR) announced a slight decrease in inflation, inline with central bank’s projections, further offering relief to household budgets.
Rwanda’s inflation rate for the month of November cooled by 0.37 percentage points to 7.39 per cent, down from 7.76 per cent in October, according to data from (NISR).
The rate is at par with the central bank’s forecast of a single digit inflation rate, between 8 and 8.7 per cent, by the end of the year.
The underlying inflation rate, which excludes fresh food and energy, decreased by 0.08 per cent to 8.05 per cent, the statistics body said in its monthly report on the country’s Consumer Prices Index (CPI)—the official measure of inflation.
According to the report, the energy index fell by 0.71 per cent, transport 0.56 as prices of imported goods eased by 0.33 per cent.
However, the report said that price of food, non-alcoholic beverages, housing, water, electricity, gas and other fuels increased.
Rwanda has managed to maintain relatively low inflationary pressures, largely on account of the central bank’s tight monetary stance.
The central bank raised the key repo rate twice since October this year to 7 per cent in November, up from 6 per cent.
“This is one of the measures to contain inflation and its good news because it’s (inflation in Rwanda) still lower than (that of) other countries in the region,” Amb. Claver Gatete, the central bank Governor said.
He said that inflation in Kenya is 19.2 per cent, Tanzania 19 per cent, Burundi at 16 per cent and 29 per cent in Uganda.
In a recent interview, Gatete said that: “We are working closely with government on some mop-ups as part of the central bank’s mandate to control demand for money.”
Although the country has managed to contain inflation in single digits, the World Bank warns that the economy faces serious external challenges.
Central bank says it is working with government institutions to take action on food security and also increase supplies especially energy, some of the main drivers of the country’s inflation.