Zambia’s inflation accelerated to 10.2 percent year-on-year in March on higher food and travel costs, from 9.8 percent the previous month, the Central Statistical Office said on Thursday.
“The increase of 0.4 percentage points in the annual inflation rate in March 2010 was attributed to … food products and public transport,” the CSO said.
Chibanda Kanyama, an economist with Zambia Breweries, said inflationary pressure may build, partly due to a firm South African rand, but it should retreat to single digits by year-end on an expected good harvest.
“The major threat is the strengthening of the South African rand. Zambia imports a lot from South Africa and the strengthening of the rand means importers will spend more and that cost will be passed on to consumers,” he said.
“(But) we will definitely achieve single-digit inflation by the end of the year because fuel will not be a factor, I don’t see another fuel price hike.”
The rand firmed nearly 30 percent against the dollar last year and has remained relatively strong in 2010, gaining slightly on the Zambian kwacha.
Zambia raised fuel prices by 15 percent in January.
The CSO also said that the trade account showed a surplus of 391 billion kwacha in February compared with a 316.6 billion kwacha surplus in January.