By ’Mathabana Kotelo
MASERU — Annual consumer inflation eased to 4.8 percent for the month of September according to the latest inflation report by the Bureau of Statistics Lesotho.
Consumer price index (CPI) — a broad measure of changes in the cost of buying goods and services — shows a 0.5 percent decline from the August figure.
August saw annual consumer inflation rocketing to 5.3 percent, the highest inflation figure recorded in the year 2013.
Month-on-month inflation for September stood at 0.5 percent, down 0.4 percent from the August figure.
Monthly price indices for the month of September showed a 0.1 percent increase in the price of bread and cereals, 1.0 percent for milk, cheese and eggs, shoes and other footwear recorded 0.4 percent, while garments and gas prices rose by 0.3 percent and 1.4 percent respectively.
Liquid fuels showed the largest increase of 3.8 percent while oils and fats showed a 0.3 percent decline.
The report further shows price increases in the following specific items in September: Wheat meal, rice, milk products, blankets, footwear for women, gas as well as paraffin.
Groups contributing to an annual increase include food with 4.2 percent, clothing at 1.9 percent, and education with 13.4 percent.
The electricity, gas and other fuels group are the biggest contributors with 22.0 percent increase.
Inflation was steady at 4.6 percent for three consecutive months of May, June and July before soaring by 0.7 percent in August.
The surge in August was mostly due to massive increases in fuel prices over the third quarter.
Liquid fuels alone rose by 11.5 percent.
Economists say inflation in the Lesotho economy is quite moderate and relatively stable.
Lesotho benefits from the Reserve Bank’s three to six percent inflation target.
Standard Lesotho Bank’s head of corporate and investment banking Mokhachane Mopeli said the fact that “interest rates are at an all-time low is an indicator that inflation is in check”.
“When inflation rises too high, it can lead to hikes in the price of the goods we consume. If a loaf of bread cost M9 before the spike of inflation, it may cost M10 after the rise,” Mopeli said.
“It can also affect the value of pensions and investments such that the buying power of the savings diminishes when inflation rises; one can no longer afford what they could buy with M100 before the rise in inflation,” he added.
South African CPI figures showed inflation slowing to six percent in September after soaring to 6.4 percent in the month of August.