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Producer inflation drops to 52.1% in January
The Producer Price Inflation (PPI), which measures the average change over time in the selling prices of goods and services as received by domestic producers, dropped marginally from 52.2 per cent in December 2022 to 52.1 per cent in January 2023.
This 0.1 percentage point drop represents the second consecutive month that the PPI has decreased.
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The drop in PPI is good news for the country as it signals that consumer inflation may drop again in February this year.
The drop in PPI in December 2022, for the first time in many months, led to a drop in consumer inflation for the first time in 22 months in January.
The January PPI rate was largely driven by a drop in the industry sector, which decreased from 65.7 per cent in December 2022 to 58.6 per cent.
The rate in the construction sector also decreased from 22.1 per cent in December 2022 to 20.4 per cent.
In the services sector, the rate decreased from 10.5 per cent to 9.5 per cent.
Industrial sector
Under the Industrial sector, the mining and quarrying sub-sector recorded the highest PPI with the rate decreasing from 73.4 per cent to 68.1 per cent in January 2023.
The manufacturing sub-sector also decreased by 11 percentage points to 53.3 per cent in January 2023.
Electricity and gas recorded a 29.9 per cent inflation rate for January 2023, a decrease of 0.5 percentage points over the December rate of (30.4%).
The water supply, sewerage and waste management sub-sector recorded an inflation rate of 26.0 percent.
Under the mining and quarrying sub sector, the extraction of crude and natural gas recorded inflation of 59.6 per cent, indicating a decrease of 23.3 percentage points over the December 2022 rate of 82.9 per cent.
Mining of metal ores increased to 4.7 per cent in January 2023 from 67.1 per cent in December 2022.
Mining support service activities recorded the least inflation rate of 44.9 per cent.
In the month under review, 10 of the 23 major groups in the manufacturing sub-sector recorded inflation rates higher than the sector average of 53.3 per cent.
The manufacture of soft drinks, refined petroleum products and nuclear fuel recorded the highest inflation rate of 166.8 per cent, followed by the manufacture of pharmaceuticals, medicinal chemicals, and botanical products at 123.7 per cent.
The manufacture of wearing apparel recorded the least inflation of 0.5 percent.
Construction sector
Under the construction sector, the buildings industry recorded the highest year-on-year producer price inflation rate of 45.9 per cent, followed by the civil engineering sub-sector with 11.4 per cent.
The specialised construction industry recorded the lowest year-on-year producer inflation rate of 5.5 per cent.
Services sector
Under the services sector, the transport and storage sub-sector recorded the highest year-on-year producer price inflation rate of 62.6 per cent, down from the 63.7 per cent recorded in December 2022.
This was followed by the accommodation and food sub-sector with 40.1 per cent.
The information and communication sub-sector recorded the lowest year-on-year producer inflation rate of 1.2 per cent.