Major components in the Consumer Price Index (CPI) basket, mainly Transport and Food, fuel inflation
Annual inflation rose by 0.8 percent from 11.9 percent in May to 12.7 percent in June 2022, the highest value since February 2009 (11.7 percent), Statistics Botswana has said.
The increase in inflation means that it remained above the Bank of Botswana’s medium-term objective range of 3 – 6 percent, and is significantly higher than the 8.2 percent in June 2021.
Transport the main driver of inflation
According to Statistics Botswana, this significant upward pressure on the annual inflation rate in June was due to increasing prices for major components in the Consumer Price Index (CPI) basket, specifically Transport (8.1 percent), Food & Non-Alcoholic Beverages (1.4 percent), Housing, Water, Electricity, Gas & Other Fuels (1.1 percent) and Miscellaneous Goods & Services (0.9 percent).
The Transport group index registered an increase of 3.1 percent, from 144.2 in May to 148.7 in June. “The increase was mainly attributable to a rise in the constituent section indices of Transport Services (14.8 percent) and purchase of Vehicles (1.0 percent),” said Statistics Botswana in the report.
Fares for long distance buses now 35t per km
The rise in Transport Services section index was mainly due to an increase in Minibus and Taxi Fares from P6.00 to P7.00 and P7.00 to P8.00 respectively, whereas long distance bus fares (bitumen road) increased from P0.30 to P0.35 per kilometre. These changes were effected on 20 May 2022.”
The Food & Non-Alcoholic Beverages group index, on the other hand, rose by 1.8 percent, from 121.6 in May 2022 to 123.8 in June 2022. “This was due to a general increase in the constituent section indices, specifically Oils & Fats (5.4 percent), Bread & Cereal (2.2 percent), Vegetables (1.8 percent), Milk, Cheese & Milk Products (1.8 percent), Food Not Elsewhere Classified (1.2 percent), Sugar, Jam, Honey, Chocolate & Confectionery (0.9 percent), Meat (Fresh, Chilled & Frozen) (0.9 percent) and Mineral Waters, Soft Drinks, Fruits & Vegetables Juices (0.8 percent),” the government statistics agency noted.
Annual price changes also occurred for the following categories of goods and services: Clothing & Footwear (from 3.8 to 4.1 percent); Health (from 2 to 2.3 percent); and Furnishing, Household Equipment & Routine Maintenance (from 5.2 to 5.3 percent).
However, the upward pressure on inflation was partially offset by inflation falling with respect to: Housing, Water, Electricity, Gas & Other Fuels (from 8 to 6.3 percent); Alcoholic Beverages and Tobacco (from 4.7 to 4.6 percent); Recreation and Culture (from 4.3 to 4.2percent); Education (from 2.6 to 2.5 percent); and Restaurants and Hotels (from 4.7 to 4.6 percent). Inflation remained unchanged for ‘Communication’ (0.4 percent).