Juba Inflation Slows in April, then Spikes

UNCLAS KHARTOUM 001091

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: ECON EFIN PREF SOCI PINR SU
SUBJECT: Juba Inflation Slows in April, then Spikes

1. A market survey in Juba taken the second week of
April shows prices stabilizing as the early rains in
March stopped and allowed the roads to dry up, with an
overall inflation month-on-month rate of just over 3

percent. Drops in the price of some grains were offset
by higher meat prices, with the food and beverage
category posting an overall rise of just over 2.5 percent
(Note: when meat prices go up, consumers tend to buy less
meat. End note.) The household goods category remained
basically steady, with a gain of just over 1 percent,
which is not statistically significant. The largest
percentage jump, nearly 40 percent, was in the
miscellaneous category (clothing, transportation,
entertainment). This was caused by the price of a bus
ride doubling from 50 Sudanese Dinars to 100 when gas
supplies began to dwindle.


2. By the end of April, diesel in Juba was unavailable,
which caused prices to rise another 3 percent, or nearly
7 percent over prices in March. The prices are expected
to return to their early April levels now that diesel is
once again available. Because the March rains did not
signal the start of the true rainy season, the expected
rainy-season price rise in April did not materialize.


3. Methodology: A local employee of the USG completed
the price survey. Prices of goods were then adjusted
based upon an estimation of the frequency of purchase for
an average family of four in one month. Due to the ad
hoc nature of data collection, these numbers are only
intended to be used as a general guide to capture market
conditions in Juba. Figures should not be compared to
other inflation indexes. Because prices are so low and
the basket of goods for an average household so limited,
small changes in pricing will lead to a larger percentage
change than in more developed economies with broader
selections of goods available. Furthermore, there is a
high degree of flexibility in purchasing patterns, and
many households are completely outside the monetary
economy, relying solely on bartering and subsistence
farming. Once it is fully operational, the Bank of
Southern Sudan plans to do a more precise and detailed
consumer price index.

STEINFELD