Consumer prices in Luanda increased 0.78% in May over the previous month, ticking down from the 0.97% rise logged in April. The softer monthly increase reflected a more moderate increase in food and non-alcoholic beverages, and housing, water, electricity and fuels prices. On the other hand, a stronger increase in clothing and footwear prices limited the overall moderation.
Inflation eased to 25.1% in May, below April’s 26.9% print. Moreover, the trend pointed down marginally, with annual average inflation coming in at 29.1% in May, down from March’s 29.4%.
Analysts at the EIU added:
“We expect steady disinflation over the course of the year, to 17.5% by year-end. Subsidies, a tighter monetary policy stance and an appreciating kwanza will more than offset high global commodity prices (particularly fuel and food). In 2023-26 disinflation will continue, albeit at a slower pace, as a result of weakening global commodity prices. A shift towards a loose monetary policy stance as the authorities prioritise economic growth, coupled with a general rise in aggregate demand, will nonetheless keep inflation relatively high.”
FocusEconomics Consensus Forecast panelists expect inflation to average 19.8% in 2022 and 13.3% in 2023.