Analysis of Inflation Developments December 2022 to December 2023
April 29, 2024
Time Frame: The data spans from December 2022 to December 2023. Geographical Zones: Different regions/zones are considered: National, Central, Dar es Salaam, Lake, Northern, South Eastern, Southern Highlands. Inflation Trends: Factors Influencing Inflation: Dar es Salaam: Increased costs of clothing and footwear, recreation, sports and culture, and alcoholic beverages and tobacco contributed to higher inflation […]
Time Frame: The data spans from December 2022 to December 2023.
Geographical Zones: Different regions/zones are considered: National, Central, Dar es Salaam, Lake, Northern, South Eastern, Southern Highlands.
Inflation Trends:
Overall Trend:
Inflation eased in all zones during the quarter ending December 2023 compared to the same quarter in 2022, except for Dar es Salaam.
Dar es Salaam experienced increased headline inflation.
Reasons for Easing Inflation:
Good harvest in the 2022/23 crop season contributed to the moderation of food prices.
Subdued food demand from neighboring countries also played a role.
Factors Influencing Inflation:
Dar es Salaam:
Increased costs of clothing and footwear, recreation, sports and culture, and alcoholic beverages and tobacco contributed to higher inflation in this zone.
Other Zones:
There's no specific mention of factors driving inflation changes in other zones, but we can infer that the moderation of food prices and subdued demand may have had a similar effect.
Table 1.1: Annual Average Headline Inflation (Percent):
Quarter ending
National
Central
Dar es Salaam
Lake
Northern
South Eastern
Southern Highlands
Dec-22
4.9
5.7
4.0
5.8
4.6
3.5
5.5
Mar-23
4.8
5.4
4.2
5.0
4.5
4.9
4.9
Jun-23
3.9
4.3
2.2
4.0
5.7
4.6
3.8
Sep-23
3.9
3.7
2.7
2.3
5.4
3.4
3.3
Dec-23
3.1
3.0
4.1
2.1
4.0
2.2
3.4
National: Inflation decreased from 4.9% in Dec-22 to 3.1% in Dec-23.
Dar es Salaam: Inflation increased from 4.0% in Dec-22 to 4.1% in Dec-23.
Other Zones: Inflation rates varied across different quarters but generally showed a decreasing trend from Dec-22 to Dec-23.
Observations:
General Trend: Overall, there's a trend of decreasing inflation across the zones, except for Dar es Salaam.
Regional Variations: Inflation rates differ among regions, with some experiencing sharper declines than others.
Sectoral Impact: Certain sectors like clothing, footwear, recreation, and alcoholic beverages contributed to higher inflation in Dar es Salaam.
Zonal inflation developments:
Overall Decline in Inflation:
Inflation rates generally decreased across different zones from December 2022 to December 2023, indicating stability in the economy.
This decline is primarily attributed to good harvests and subdued food demand from neighboring countries.
Regional Variations:
While most zones experienced a decrease in inflation, Dar es Salaam stood out with an increase in headline inflation.
Factors such as rising costs of clothing, footwear, recreation, sports, culture, and alcoholic beverages and tobacco contributed to this increase in Dar es Salaam.
Sectoral Impact:
In Dar es Salaam, specific sectors like clothing, footwear, recreation, and alcoholic beverages played a significant role in driving inflation upward.
In other zones, the moderation of food prices due to good harvests seems to have been a major factor in lowering inflation.
Quarterly Trends:
The provided table shows fluctuations in inflation rates across different quarters, with varying degrees of decline or increase.
For example, the inflation rate in Dar es Salaam increased from 4.0% in December 2022 to 4.1% in December 2023, whereas the national average decreased from 4.9% to 3.1% during the same period.
Economic Stability:
The overall decline in inflation rates shows relative economic stability, which is crucial for sustainable economic growth.
However, localized inflationary pressures, as seen in Dar es Salaam, may need specific attention to prevent further escalation.
