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Bloomberg
Changing weather patterns are pushing up food prices and will drive inflation in Rwanda for the first few months of this year, central bank Governor John Rwangombwa said.
Unexpectedly heavy rains in the second half of 2019 caused some crop damage and food inflation reached 23.8% in December, the highest in almost three years.
“Because of the bad rains we had in the last quarter of 2019 we expect inflation in the first quarter of 2020 to be slightly above our medium-term benchmark of 5%,†Rwangombwa said in an interview in the capital, Kigali. However, the rate will remain inside the target band of 2% to 8%, he said.
The central bank uses the urban inflation rate as the headline indicator that it targets, although the majority of Rwanda’s population of 12 million live in rural areas. Urban inflation reached reached 6.9% in November, the highest level in more than two years, before slowing to 6.7% in December. The rural inflation rate is more than double that.