IN an economic cycle where prices are going up, women’s clothes and children’s shoes are defying the norm – they are now cheaper compared to a year ago.
According to February 2022 statistics released by the Namibia Statistics Agency (NSA), the prices of these two items are down 3,4% and 4,9%, respectively, and are recorded the highest deflation for the month.
Men’s clothes were also down, by 3,1%, while children’s clothes were 1,8% more expensive than they were a year ago.
For those who can afford flights, tickets are also cheaper than they were a year ago, 3,2% down.
Overall, the price of an average consumer basket went up 4,5% in February this year, compared to February last year. This is, however, a less aggressive price push compared to January when prices edged up by 4,6%.
Making the announcement, NSA chief Alex Shimuafeni said last month the annual inflation rate continued on an upward trend, increasing by 4,5% compared to 2,7% recorded in February 2021.
On a monthly basis, the inflation rate stood at 0,2% compared to 1,1% recorded a month earlier.
On average, over the last year ending February, prices of goods and services went up by 3,9%.
Broken down – goods are becoming more expensive, up on an annual basis by 5,5%, while services trail behind at 3%.
Prices are, however, not increasing in the same proportions – the northern part of the country (the north-central regions and Zambezi) remains cheaper, with prices only up by 3,9% – the lowest price increase in the last four months.
In Zone 2, which covers the central part of the country (Khomas region), prices went up 5,3% on an annual basis, while in Zone 3, which covers (//Kharas, Erongo, Hardap and Omaheke), prices went up 4,1%.
On individual categories, the highest change in the annual inflation rate was in transport (13,2%); hotels, cafés and restaurants (9%); furnishings, household equipment and routine maintenance of the house (8,2%); food and non-alcoholic beverages (5,4%) and alcoholic beverages and tobacco (3,5%).
The prices of key ingredients for several family meals have gone up too.
Prices for bread and cereals increased by 3,6% last month compared to 3,2% in February last year.
The increase in the annual inflation rate for this sub-category resulted mainly from the rise in the price levels of bread (from 3,7% to 7,1%) and maize meal/grain (from -2,1% to 1,1%).
Prices for oils and fats increased by 13,4% last month compared to 10,6% recorded in February last year. Cooking oil was up from 16,2% to 19,5%).
The price levels of fish recorded an inflation rate of 3,9%, while meat increased by 7,2% during the period under review compared to 11,8% registered during the same period last year.
Gerrit van Rooyen, an economist at Oxford Economics, says although the headline inflation rate dipped slightly in February, upward adjustments in Namibian fuel prices in coming months will drive inflation higher.
This month, the Ministry of Mines and Energy increased fuel prices higher by between N$1,20 and N$1,30 per litre after the benchmark global Brent crude oil price rose beyond US$100 per barrel following the Russian invasion of Ukraine late last month.
Furthermore, the average Brent crude price is this month set to end above the US$93,9pb level recorded last month. Hence, further large fuel price adjustments are likely next month.
“As a result of these fuel price hikes, transport price inflation will likely remain near double digits throughout most of the year. Additionally, the prices of wheat, maize and fertilisers have also surged in the wake of the Russian invasion, which will exert upward pressure on food price inflation. Due to these developments, we will adjust our current 2022 average inflation forecast of 4,7% higher in the next forecast round,” he said.