Times Of Swaziland: HEADLINE INFLATION UP TO 3.9%

HEADLINE INFLATION UP TO 3.9%
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BY ASHMOND NZIMA  on 17/09/2020 01:27:00


MBABANE- Headline inflation rate in the past month was recorded at 3.9 per cent.
This is the annual percentage change in the consumer price index (CPI) in August
2020 compared with that of the same period in 2019.
According to figures from Central Statistical Office (CSO), the annual rate
corresponded to the same 3.9 per caent observed in July 2020. The month-on-month
inflation rate change is 0.3 per cent.
The higher headline inflation was attributed to increasing annual rates of
change reflected in August in the price indices for miscellaneous goods and
services which increased from -0.7 in July 2020 to 0.8 per cent.
Other contributors included products for personal care.
Clothing and foot wear increased from -0.1 per cent in July to 0.9 in August
2020. Footwear (namely shoes) mainly contributed to the higher index in this
category. Transport increased from 1.7 to 2.3 per cent in August 2020,”
reported CSO.
The increasing rates were slightly counteracted by decreasing rates of growth in
the price indices for education. The latter decreased from 9.6 to 6.8 per cent
in August. Tertiary education contributed to the decreased index in this
category.
Measure
Meanwhile, headline inflation is simply a measure of the total inflation within
an economy, including commodities such as food and energy prices which tend to
be much more volatile and prone to inflationary spikes.
On the other hand, core inflation (also non-food-manufacturing or underlying
inflation) is calculated from a price index minus the volatile food and energy
components.
Present
Headline inflation may not present an accurate picture of an economy’s
inflationary trend since sector-specific inflationary spikes are unlikely to
persist.
Core inflation represents the long-run trend in the price level. In measuring
long-run inflation, transitory price changes should be excluded.
One way of accomplishing this is by excluding items frequently subject to
volatile prices, like food and energy.