Rwanda’s annual inflation decreased to 12.69 percent in May from 13.64 percent in April, increasing government prospects of annual single digit inflation target. The National Institute of Statistics of Rwanda (NISR) said in its monthly statement that the general consumer prices index fell to 182.3 units in May form 184.2 units in the previous month, representing a decrease of 1.04 percent. The body attributed the fall in inflation to the decrease in prices of food, non-alcoholic beverage, housing, water, electricity, gas and other fuels and clothing and footwear. It said prices of food and non-alcoholic beverages fell by 1.60 percent, housing, water, electricity, gas and other fuels by 1.36 percent, and clothing and footwear 1.81 percent. The NISR also said that underlying inflation, which excludes fresh food and energy eased at 10.8 percent in May from 12.6 percent in the previous month. According to the Consumer Price Index (CPI) statement, vegetables decreased by 3.54 percent. “The ‘local goods’ increased by 14.18 percent on annual change…while prices of the imported products rose by 8.33 percent on annual change with a monthly change of -0.57 percent. “The prices of the fresh products had a positive annual change of 25.30 percent between May 2009 and May 2008.” Theogene Mugabo, who is in charge of external trade statistics at NISR, said the fall in inflation did not automatically mean a decline in the cost of living in real terms. “It is a good trend. But, there are other factors which determine the cost of living. Interest rates have risen, which has lowered access to credit and I don’t think that people’s incomes have increased,” he said. He expects a further fall in inflation but experts predicted it is likely to rise, given a recent rise in fuel prices on the local market. Government hopes to keep annual inflation in double digits as the economy is expected to grow by 5.7 percent in the financial year 2009/10 Ends
