By William Kumwembe:<\/p>\n
The International Monetary Fund (IMF) has projected a solid downward trajectory of inflation beyond 2018, converging at 5 percent in the long term.<\/p>\n
The Bretton Woods institution has since said it expects Malawi\u2019s inflation to average 9 percent this year, in line with an earlier projection by Reserve Bank of Malawi (RBM).<\/p>\n
IMF says it expects inflation to close at 9.5 percent by end of 2018.<\/p>\n
Ironically, the outlook comes at a time inflation has continued on an upward spiral in the past three months, hitting 9.5 percent in September 2018.<\/p>\n
RBM said headline inflation is expected to continue rising in the next few months, saying pressures would emanate from the 20 percent electricity base tariff increase and 5 percent fuel pump price hike effected in October 2018 as well as pressure on maize.<\/p>\n
But responding to an emailed questionnaire, IMF Resident Representative, Jack Ree, said, overall, inflation has behaved better than what was expected before 2018 began.<\/p>\n
Ree said, back then, IMF was worried about the possibility of major inflation reversal based on Malawi\u2019s unfortunate history of repeated rise of inflation volatility and the unfavorable base-effects\u2014like maize price was abnormally suppressed in 2017 and its natural unwinding was expected to push food price inflation.<\/p>\n
\u201cHowever, inflation has fared remarkably well so far. This expected path is consistent with an annual average inflation of around nine percent this year,\u201d<\/em> Ree said.<\/p><\/blockquote>\n
He said, if Malawi manages to maintain inflation at close to single digit this year, 2018 will mark the second consecutive year of winning Malawi\u2019s war on inflation.<\/p>\n
Ree said the current gains in inflation fight are not an outcome of mere luck but reflect robust changes in the quality of macro-economic policy\u2014a key to make favourable inflation performance sustainable.<\/p>\n
He then called on the government to be prudent if it is to sustain registered gains.<\/p>\n
\u201cThere is no silver bullet in inflation fight. We just need to be persistent and vigilant. We also need to have a credible framework of monetary policy,\u201d<\/em> Ree said.<\/p><\/blockquote>\n
To attain the goals, Ree said RBM should be given a clear mandate for inflation fight and autonomy to pursue it without, stranded by political interference.<\/p>\n
He said the central bank should also be able to engender a virtuous circle of trust by communicating its policy intention well and proving its seriousness through action.<\/p>\n","protected":false},"excerpt":{"rendered":"
By William Kumwembe: The International Monetary Fund (IMF) has projected a solid downward trajectory of inflation beyond 2018, converging at 5 percent in the long term. The Bretton Woods institution has since said it expects Malawi\u2019s inflation to average 9 percent this year, in line with an earlier projection by Reserve Bank of Malawi (RBM). […]<\/p>\n","protected":false},"author":3,"featured_media":55973,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-70849","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts\/70849","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/comments?post=70849"}],"version-history":[{"count":1,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts\/70849\/revisions"}],"predecessor-version":[{"id":70853,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts\/70849\/revisions\/70853"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/media\/55973"}],"wp:attachment":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/media?parent=70849"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/categories?post=70849"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/tags?post=70849"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}