Finance Minister sees Mauritius’ inflation falling to 3.7% in 2013
Charles Gaëtan Xavier-Luc Duval, Vice-Prime Minister and Minister of Finance and Economic Development of Mauritius, at the South Relations Session of the World Economic Forum on Africa held in Addis Ababa, Ethiopia, 9-11 May, 2012. (Source: Wikipedia)
Finance Minister Xavier-Luc Duval said on September 13 that Mauritius’ annual average inflation rate is expected to fall to 3.7 percent this year from 3.9 percent in 2012, based on Statistics Mauritius estimates. This was in line with the last monetary policy meeting, where the Bank of Mauritius had said the headline inflation would be within a range of 4.1-4.3 per cent by December 2013.
The inflation rate in Mauritius was recorded at 3.50 percent in August 2013 by Statistics Mauritius. Also, the headline inflation rate for the twelve months ending June 2013 worked out to 3.6% compared to 5.1% for the twelve months ending June 2012. It may be noted that inflation has been displaying a consistent downward trend with the latest estimates from Statistics Mauritius seeing inflation at 3.7 percent this year down from 3.9 percent last year and 6.5 percent in 2011.
Duval, also the Vice-Prime Minister of Mauritius, said that globally inflationary pressures have receded given the economic slowdown and slower growth in commodity prices. Mauritius cut its 2013 economic growth forecast in June to 3.3 percent from 3.5 percent, on fears of a slowdown in the construction sector and sluggish growth in financial services and technology. With tourism being an important pillar of the economy, Mauritius expects a recovery in tourist arrivals following a rise of 11.5 percent in August to 73,454 from a year ago.
In June, Mauritius cut its key repo rate by 25 basis points to 4.65 percent to stimulate growth at a time when inflation was benign. On a quarterly basis, the Consumer Price Index (CPI), which stood at 103.4 in April 2013, remained at the same level in June 2013. The main reasons for the CPI movements from April to June 2013 were higher prices of vegetables and some other food products offset by lower interest rates on housing loan.
Besides the falling inflation, another much-needed economic relief for Mauritius came in the form of the upward climb of the foreign direct investment (FDI) in Mauritius, rising 16.1 percent in the first six months of 2013 to 4.736 billion rupees ($153.27 million) from 4.077 billion a year ago. The figures were released by the central bank on September 13.
Historically, Mauritius inflation rate averaged 6.84 percent from 1988 until 2013, reaching an all-time high of 18.10 percent in April 1989 and a record low of -1 percent in January 1992. In Mauritius, the inflation rate measures a broad rise or fall in prices that consumers pay for a standard basket of goods.