According to projections from the Economist Intelligence Unit (EIU), inflation will average 8.8% this year.

EIU has justified its prediction to lower global oil prices. Meanwhile, annual inflation rate in Malawi rose to 11.5% in December 2019 from 10.4% in November, marking as the highest inflation rate the country has recorded. Should EIU’s projection come to fruition, the average inflation will be 0.6% lower than 9.4% average inflation for last year.

The Reserve Bank of Malawi (RBM) has missed the inflation target of 9.2% for 2019 by 0.2 percentage points, attributed to rising food prices was a major challenge to monetary policy in 2019. During the period in review, low supply of maize saw a spike in prices, from K5,500 to an average price of K15,000 per 50 kg bag.

While NSO food and non-food inflation rates stood at 19.3 and 4.9 percent, respectively in December, RBM spokesperson Mbane Ngwira says that food prices will collapse this year. “…food prices will collapse and converge towards non-food inflation, assuming there will be no any serious supply shock in 2020, hence, this challenge is considered temporary,” he said.