Single digit inflation
The Central Bank announces a drop in the inflation rate. But why are prices still so high?
Inflation has gone down to single digits- from 10.3 per cent in May to 8.4 per cent last month.
The Central Bank announced on Friday that this was the lowest rate for the last 17 months.
Food prices have gone down according to the Bank. Bread and cereals which were also 20.4 per cent in May were12.5 per cent There were also decreases in meats and oils and fats and there was a drop in inflation, generally, for the first half of the year.
Clothing and footwear also saw a sharp drop.
The pattern showed a drop in bank credit, a drop in real estate prices but an increase in unemployment. The bank, however, warned of downsides of an increase in the prices of agricultural produce through floods and whether on the whole inflation expectations have been fully reversed. Earlier this year, inflation had jumped to 14.3 per cent.
These figures will be placed in the mix as the Government works on finalising the 2009-2010 national budget which will be presented to Parliament in September