Central Bank: Headline Inflation and Food Inflation Down for April 2024

Central Bank Governor Mr Buah Saidy (c) Yusef Taylor

By Yusef Taylor, @FlexDan_YT

Headline Inflation Down to 11.5% and Food Inflation Down to 15.6%

The Gambia’s Central Bank held a press conference on 23rd May 2024 revealing that headline and food inflation had declined in April 2024. Inflation measures the rate at which prices of goods and commodities are increasing or decreasing. Headline Inflation is the total inflation figure in an economy. The headline inflation figure includes inflation in a basket of goods that include commodities like food and energy.

Headline Inflation Down by 3.9%

During the press conference, Central Bank Governor Buah Saidy revealed that “headline inflation decelerated for the third consecutive month, driven by moderated global commodity prices and domestic policy actions. In April 2024, headline inflation declined to 11.0%, down from 14.9% in March 2024 and the peak of 18.5% in September 2023”.

Giving reasons for the decrease, Central Bank Governor, Buah Saidy noted that “the decline was broad-based, with a fall in both food and non-food inflation. Looking ahead, if there are no sudden surprises, especially in global commodity prices, inflation is expected to decelerate to single digits by [the] end of 2024”.

Comparing this to global headline inflation, Governor Buah Saidy noted that “the IMF global inflation is anticipated to decrease, from an annual average of 6.8% in 2023 to 5.9% in 2024 and further to 4.5% in 2025”.

The Gambia Inflation Figures from Sep 2023 to April 2024

Food Inflation Down by 4.1%

Food inflation measures the rate of price increase of food commodities. Generally, as long as Inflation is above zero then prices are increasing and the higher the number the higher the rate of price increases. If inflation is negative then prices are going down.

According to Governor Saidy, “food inflation [also] decreased to 15.6% from [sic] 21.0% in December 2023. The decline in food inflation was predicated on the significant deceleration in the prices of bread & cereals, and meat while prices of vegetables and dairy products held up”.

The Gambia imports most of its goods to the country which are then sold locally in the market. Therefore, the price of international commodities are expected to influence the price of local commodities. Governor Saidy highlights that “the FAO Food Price Index in April 2024 marginally increased by 0.3% from its March level. The increase was driven by a rise in the prices of meat, vegetable oil, and cereals, which outweighed the decline in the prices of sugar and dairy products”.

This means that while prices declined globally for sugar and dairy products, in The Gambia food prices declined for bread and cereals, and meat. On the other hand globally food prices decreased for sugar but those price decreases have not been translated in The Gambian economy where sugar prices continue to increase.

According to the latest GBOS CPI for March 2024, “from March 2023 to March 2024, within Food and Non-Alcoholic Beverages, ‘Other Food Products N.E.C’ increased by 39.14%, ‘Fish’ increased by 32.89%, Vegetable, Root Crops and Tubers’ increased by 27.89%, ‘Fruits and Nuts’ increased by 22.37%, Sugar, Jam, Honey and Sweets’ increased by 21.38%, ‘Bread and Cereals’ increased by 16.82%, ‘Milk, Cheese and Eggs’ increased by 13.95%, ‘Meat’ increased by 10.81%, ‘Non-alcoholic Beverages’ increase by 8.62%, and Oils and Fats’ increased by 5.94%”.

This highlights some of the highest price increases for food products in March 2024.

Rice is one of the main staple food in the Gambia. The Central Bank’s latest statement highlights that “average international rice prices experienced a moderate decline in April 2024 for the second month in a row. The FAO Rice Price Index decreased by 1.8% compared to the March level, but still 9.2% higher than the value it was a year ago. However, global rice prices are still projected to remain elevated this year due to the impact of adverse weather conditions on production and export restrictions”.

Non-Food Inflation Down by 3.3%

Declines were also observed in non-food inflation. Governor Buah Saidy revealed that “non-food inflation declined to stand at 5.4% from 8.7% reported in March 2024, owing to a decrease in prices of textiles and energy”.

Similarly, the GBOS March 2024 CPI indicates that "from March 2023 to March 2024 "for the Non-Food products, major increases were recorded by ‘Education’, 37.39%, ‘Housing, Water, Electricity, Gas and Other Fuels’, 19.61%, ‘Hotel, Café and Restaurant’, 15.47%, ‘Furnishing, Household Equipment ETC.’ 13.09%, ‘Clothing and Footwear’, 10.60%, ‘Miscellaneous’, 8.45%, ‘Alcoholic Beverages, Tobacco and Narcotics’ 3.89%, ‘Transport’ 3.26% and ‘Recreation and Culture’, 2.6%".

This highlights some of the non-food products that increased the most according to the GBOS CPI for March 2024.

Governor Saidy concluded by explaining that “Central Bank’s core measure of inflation, which excludes volatile energy and food products, also declined significantly during the review period, suggesting that underlying inflationary pressures are abating”.