Namibia's inflation edges down in June

Source: Xinhua| 2017-07-15 23:58:24|Editor: huaxia
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WINDHOEK, July 15 (Xinhua) -- Namibia's annual inflation rate for the month of June 2017 decelerated to 6.1 percent from 6.7 percent recorded in June 2016.

This is according to a review released Friday by the Windhoek-based stock broker and wealth management firm Simonis Storm Securities.

According to the review, there was a significant decrease in inflation under the food and non-alcoholic beverages from a double digit level of 11.3 percent in June 2016 to just 4.6 percent in June 2017.

"Inflation in the category of alcoholic beverages and tobacco has also improved substantially from 7.1 percent in June 2016 to 3.1 percent in June 2017," Simonis Storm said.

These categories, the stock broker firm said, are among those with highest weight in the consumer basket, hence the continued deceleration in overall inflation.

"We view the continued downward spiral in the inflation rate as a reflection of an improvement in agricultural production, particularly soft commodities, strengthening of the South African rand, and thereby lower imported inflation compared to the previous period," the review said.

Housing, water, electricity and gas, however, the review further said, increased 2.2 percent on an annual basis.

In addition, Simonis Storm said as the South African inflation continues to fall within the preferred band of 3 - 6 percent, the South African Reserve Bank is expected to cut its repo rate by 50 basis points over the next 12 months.

"We believe that this would have a knock on effect on Namibia's monetary policy. We thus expect the Bank of Namibia (BoN) to follow suit by reducing its repo rate by 25 basis points in early 2018," the review said. Enditem