Inflation in Zambia decelerated to an eight-month low in September as food-price growth slowed down from an all-time high, and the currency’s recent two-month streak helped to limit import costs.

Consumer prices in the country increased 22.1% compared to last year, following on from a 24.4% reading in August, according to Zambia’s interim statistician-general, Mulenga Musepa, speaking to reporters on Thursday in Lusaka.

In addition, costs declined 0.5% in September, Bloomberg reports. Food-price growth decelerated to 29.6% last month, compared to 31.6% in August, whilst non-food inflation edged down to 13.6% from 16.3% in August.

The inflation slowdown – having been over the 8% upper limit of the central bank’s target range for over two years – could alleviate pressure on the monetary policy committee to tighten, allowing room to bolster Zambia’s economic recovery when Governor Denny Kalyalya chairs his first meeting next month since his recent reappointment.

The Bank of Zambia maintained its key interest rate at the latest monetary policy committee meeting. Furthermore, the central bank forecasts inflation will decelerate at a faster rate sooner than predicted, moving nearer to the 6% - 8% target band.

The monetary policy committee forecasts average price growth to hit 22.6% in 2021, 15.5% in 2022 and 11.9% in the first six months of 2023.

The principal risks to inflation include energy costs and the Kwacha, that lost close to 5% against the Dollar last month following a two-month world-beating run.

Moreover, Zambia’s Finance Ministry forecast the economy to grow 1.6% in 2021. This compares to the 0.6% growth predicted by the International Monetary Fund, after the economy contracted the most in 20 years last year to 2.8%. GDP grew 8.1% in Q2 compared to the year before.