2005 records lowest inflation rate ever

The Bank of Namibia says last year's inflation rate is the lowest ever recorded by Namibia since independence in 1990. This is contained in the 2005 Annual Report launched by central bank governor, Tom Alweendo, in Windhoek on Thursday.

The report says 2005 started off with an annual inflation rate of 2.5% in January, which rose to 2.6% in February and declined to 0.9% in May. It later picked up in June, edging upwards to 1.3% and increased further to reach the highest level during the year at 3.3% in December. This resulted in an average of 2.3% for the year. This rate was much lower than the 4.2% recorded in 2004. The report says the major contributors to the low inflation were housing, water, electricity, gas and other fuels and alcoholic beverages and tobacco indexes. The other groups which contributed were clothing and footwear, health, recreation and culture, communications and education indexes.

The report said food and non-alcoholic beverages, transport and furnishings, household equipment and routine maintenance of the house indexes saw inflation rates increasing.
The report says the upping of the inflation rate of the transport index was mainly due to the increases in fuel prices. Although fuel prices increased substantially during the period under review, their impact on the overall inflation rate was moderated by lower rates in the food, housing, water, electricity, gas and other fuels indexes.