By Nokunceda Magagula | 2025-03-17

The Consumer Price Index (CPI) report states that electricity, water, and gas bills were the highest contributors to the inflation rate, accounting for 1.7 per cent of the overall figure of four per cent.

In comparison, food and non-alcoholic beverages contributed 0.9 per cent, while alcoholic beverages, tobacco, and narcotics added 0.6 per cent to the inflation rate.
Economist Sanele Sibiya stated that utilities were the main contributors to inflation due to the recent four per cent hike in water tariffs by the Eswatini Water Services Corporation (EWSC).

He explained that the contribution was due to that water was hiked in one instance in a year and this time it was hiked recently. The following months water was considered to be affordable, thus contributing to the lowering of inflation.
In February, the country experienced a headline inflation rate of four per cent, marking a slight decrease from the 4.1 per cent recorded in January.

This figure is also 0.3 percentage points lower than the 4.3 per cent inflation rate observed in February 2024, indicating a gradual easing of inflationary pressures over the year.
When examining the year-on-year changes, notable shifts were observed in various categories:
“Alcoholic beverages, tobacco, and narcotics saw a significant increase, rising from 3.1 per cent in February, 2024 to 11.8 per cent in February primarily due to price hikes in wine and beer,” reads the report.

Conversely, restaurants and hotels experienced a decrease from 13.5 per cent in February 2024 to 6.1 per cent in February, attributed to slower growth in accommodation services.
Miscellaneous goods and services also declined from 12.8 per cent to 6.3 per cent, reflecting slower growth in electrical appliances and other services.

On a month-on-month basis, the inflation rate showed a modest increase of 0.1 per cent in February compared to January, which is a decrease from the 0.5 per cent observed in the previous month. This indicates a stabilisation in prices, particularly in the following areas:
Restaurants and hotels improved slightly from -7.8 per cent in January to -0.8 per cent in February, suggesting a recovery in accommodation services.

However, education and miscellaneous goods and services saw declines, with education remaining stagnant at 0.0 per cent and miscellaneous goods dropping to 0.3 per cent.
The February CPI report reveals a complex landscape of inflation, with utilities being the primary drivers of the current rate.

While some sectors are experiencing price increases, others are stabilising or declining, reflecting the ongoing adjustments in the economy. As consumers navigate these changes, the focus will remain on how these trends evolve in the coming months.
With the Monetary Policy Consultative Committee meeting on Friday, these latest figures will likely play a crucial role in determining the next steps regarding interest rate.

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