The cost of goods and services rose 14.8% in May this year-Report | The new times

Rwanda’s Consumer Price Index (CPI), the main indicator of inflation, increased by 14.8% (on an annual basis) in May this year, compared to the same month last year, according to data published by the National Institute of Statistics of Rwanda. (NISR) on June 10, 2022.

Statistics show how the prices of goods and services have increased, causing consumers to pay more to meet their needs.

The CPI is one of the main economic indicators of inflation because it calculates the change in the cost of a set of consumer goods and services [purchased by households] overtime.

A higher selling price indicates lower consumer purchases and higher inflation, according to the NISR.

According to the International Monetary Fund (IMF), inflation is the rate of increase in prices over a given period. Inflation is usually a broad measure, such as the overall increase in prices or the increase in the cost of living in a country.

However, NISR statistics indicate that Rwanda’s CPI increased by 2.1% on a monthly basis (from May 2022 to April 2022).

The urban CPI, which takes into account the average change over time in the prices paid by urban consumers for a basket of consumer goods and services, increased by 12.6% on an annual basis (May 2022 and May 2021) and 1.9% on a monthly basis (May 2022 to April 2022).

On the other hand, the rural CPI, which focuses on rural consumers, increased by 16.4% on an annual basis and 2.3% on a monthly basis.

In May 2022, food and non-alcoholic beverage prices increased by 24.2% on an annual basis and by 5% on a monthly basis.

Also, on an annual basis, local products [price] increased by 11.5%, that of imported goods increased by 15.9%, that of fresh products (food products which have seasonal fluctuations) increased by 17.7%, while for energy, its index prices increased by 17.6%.

On a monthly basis, the index of local goods increased by 1.6%, the index of imported goods increased by 2.8%, the index of fresh products increased by 3.1%, while the energy index decreased by 1.3%.

For housing, water, electricity, gas and other fuels, their prices increased by 8% on an annual basis and decreased by 0.3% on a monthly basis. Transport prices increased by 7.7% on an annual basis and by 1% on a monthly basis.

Restaurant and hotel prices rose 14.3% year-on-year and 0.1% on a monthly basis.

The data also shows that the prices of local products increased by 11.5% on an annual basis and by 1.6% on a monthly basis, while the prices of “imported products” increased by 15.9% on an annual basis. annually and 2.8% on a monthly basis.

Russian-Ukrainian war, key price factors of agricultural performance

When presenting the 2022/2023 national budget forecast to MPs on May 19, Uzziel Ndagijimana, Minister of Finance and Economic Planning, said that in the first nine months of 2021 inflation was low – on average 0.7%, mainly due to low food prices resulting from a good agricultural harvest.

However, he said prices started to rise in the last quarter of last year, so in the first quarter of this year, headline inflation jumped to 7.5%.

“This was mainly caused by the Russian-Ukrainian war, which severely disrupted the supply chain of raw materials and triggered the global price increase, as well as the domestic price increase resulting from the negative effects of the climate change on agricultural products,” he said.

For 2022 as a whole, Ndagijimana said, prices in the market are expected to increase by 9.5%, but drop to 8% in 2023, largely due to rising global costs.

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