Headline inflation is expected to continue its downward trend to 14.75% in February. This represents a steeper rate of decline from January’s deceleration of 0.24%. In contrast, month-on-month inflation in February is expected to increase to 1.01% (12.82% annualized) from 0.80% (10.03% annualized), driven largely by increased prices in the food basket.
The anticipated decline in inflation together with the weak growth recorded in 2017 (0.8%), increases the possibility of the adoption of an accommodative monetary policy stance (i.e. reducing interest rates).
In the attached bulletin, the FDC Think-Tank analyses inflationary pressures in the economy.
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