Inflation drops to lowest level since April in July

Latest reading: Inflation came in at 4.3% in July, which was down from June’s 4.6% and marked the lowest inflation rate since April. As a result, inflation inched down to the Central Bank’s 2.0–4.0% target. Price pressures for food, recreation and hospitality eased, and transport costs swung into decline. Meanwhile, housing and utilities prices rose at a quicker pace in July compared to the previous month. The trend pointed up mildly, with annual average inflation coming in at 4.3% in July (June: 4.2%). Meanwhile, core inflation fell to 4.0% in July from June’s 4.4%. Finally, consumer prices rose 0.39% from the previous month in July, following June's 0.13% rise. July's figure marked the highest reading since February.

Panelist insight: EIU analysts said: “Underlying inflationary pressures remain strong. Price pressures in the services sector will ensure that inflation remains above the upper end of the NBH's target band (3% ±1 percentage point) until late 2025, despite periodic government efforts to control food price inflation.”

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