Headline inflation declined for the fifth consecutive month, precisely in line with the FDC Think Tank forecast. The headline rate dipped marginally to 16.1% from 16.25% in May on a backdrop of exchange rate gains and less on waning base year effects.

The core sub-index, which measures inflation less seasonality, recorded its eighth consecutive month decline to 12.5% from 13% in May. All other sub indexes such as MoM inflation, rural and urban indexes also declined.

The food index continues to increase, currently as a result of planting season output constraints.

These factors are going to influence discussions at the upcoming MPC meeting next week. The inflationary direction and relative stability in the forex market are good news for an MPC which is under high public scrutiny.

In the attached bulletin, the FDC Think-Tank analyses price movements in June.

Do enjoy your read…