Inflation rises to highest level in over seven years in June

Inflation increased to 31.0% in June from May’s 30.2%. June's figure marked the highest inflation rate since May 2017. Recently high price pressures have been fueled by surging agricultural prices, insufficient domestic food supply, a weakening kwanza and last year’s removal of petrol subsidies. The trend pointed up, with annual average inflation rising to 21.6% in June (May: 19.9%). Lastly, consumer prices increased 2.07% over the previous month in June, a smaller increase than the 2.49% rise recorded in May. June's result marked the softest rise in prices since August 2023.

Gerrit van Rooyen, analyst at Oxford Economics, commented: “The passthrough from the acute currency devaluation in May/June 2023 has resulted in among the highest operating costs in Africa. As part of its economic reforms, Luanda has also reduced fuel subsidies and introduced more taxes to broaden the tax base, these measures have added upward inflation pressure. The Angolan government has committed to removing all fuel subsidies by the end of 2025. The inflation outlook remains largely bound to developments in domestic oil production and the global oil price, which could adversely affect the exchange rate.”

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