The Inflation Report of the Bank of Mauritius (BoM) was made public yesterday, releasing quite some good news. The inflation rate for this year must be manageable. The rate of inflation will fluctuate between 3.9 % to 4.3 %, as compared to 4 % which was reported last December.
According to the report, the inflationary pressures have decreased – inflationary pressures are exerted when the price of commodities increase at a higher rate than the salaries of the population. The economic activities have known some decline in both industrialsed countries and industrialising ones, which explains why the inflationary pressures lessened. The BoM relied on the last report of the International Monetary Fund, the World Economic Outlook, to draw out its conclusions: based on this, the BoM says that the increase in the price of commodities will be quite low. In the local context, the increase in price of vegetables that had occurred in the beginning of the year as a result of the rainy weather will not be reflected in the coming months.
However, inflation could still be caused by other factors like increase in salaries. Recommendations from the National Renumeration Board could lead to the rise in wages, which would then impact on the inflation rate.