Increase in food prices pushes up inflation to 7.2%

By Our Reporter

The Annual Headline Inflation for the year ending September 2015 increased to 7.2% compared to the 4.8% recorded at the end of August. This was largely attributed to the Annual Food Crops Inflation that increased to 10.2% compared to the 1.8% registered during the year ended August 2015.

Similarly, Annual Core Inflation increased to 6.7% compared to 5.5% registered in the previous month.
Masaka center registered the highest Annual Inflation of 10.5% compared to 5.5% in August. This was driven by high price levels of food, clothing, footwear, rent, charcoal, firewood, other goods and services.

Second was Mbarara center which registered 9.3% compared to 3.3% recorded in the period under review. The main drivers were high price levels of food, clothing, footwear, medical services and meals in restaurants.
Kampala Middle and Low Income center registered the third highest Annual Inflation of 7.5%, compared to 6.0% recorded in August 2015. The main drivers were high price levels of food, clothing, footwear, meals in restaurants, other goods and services.

Food registered an annual inflation of 10.5% compared to 5.1% previously. Annual Non- Food Inflation also increased to 5.7% to 4.7% in August.

Inflation for other goods rose to 6.4% while that of services went up to 6.7 %.

Monthly Headline Inflation for the month of September 2015 increased by 2.6% from the earlier 0.5 percent rise recorded in August 2015. This was attributed to increase in monthly food crop inflation.

Food Inflation, which includes food crops and processed foods, rose by 5.9% during the month. The drivers were the increase in prices of matooke, sweet potatoes, Irish potatoes, mangoes, pineapples, cabbage, tomatoes, green pepper, bbugga, beans, fish, fresh milk and sugar in most centers. However there was a reduction in the prices for cassava, passion fruits, oranges, sweet bananas, avocado, bitter tomatoes, onions, carrots and maize flour.

The monthly Core Inflation for September rose to 1.3% from the 0.6% increase observed in August 2015. The drivers were the increase in prices of education charges, medical charges, pharmaceutical products, charcoal, clothing, footwear, household textiles, bicycles and bicycle spare parts.