Highlights
Inflation:
SoSh (Somali shilling)-using areas: Consumer Price Index (CPI) changed at mild rates (2-3%) month on month in SoSh using areas in July and August except in Central regions where the CPI increased by 14 percent in July due to increase in the prices of red sorghum. The CPI rose annually from mild (3%) to high rates (20%) due to increase in red sorghum prices.
SISh (Somaliland shilling)-using areas: The CPI increased month-on-month (2-4%) as well as year-onyear (12-13%) in July and August due to increase in cereal (red sorghum) price in the past 12 months.
Exchange rate:
SoSh-using areas: The exchange rates between SoSh and the United States Dollar (USD) indicated marginal monthly changes (1-3%) in most regions both in July and in August 2016. The SoSh shows annual depreciation across SoSh-using areas in the last two months.
SISh-using areas: The SISh indicated marginal (1%) depreciation against the USD in July 2016 but remained relatively stable in August compared to previous month and 12 months ago.
Local grain prices changed at mild rates (by less than +/-10%) in both July and August 2016 in most parts of the country. The exceptions are Banadir (Mogadishu), Middle Shabelle and Central regions.
Specifically, cereal prices increased (25%) in Central in July 2016, while cerael prices declined (11-24%) in Banadir (Mogadishu) and Middle Shabelle regions, both in July and August 2016, as a result of increased supply in the markets. Annual comparison indicates higher prices for local grains in most regions of the country in both July and August 2016 with the highest increase being recorded in Middle Juba (28-39%) as a result of poor Gu 2016 production.
Prices of imported food (rice, sugar, vegetable oil, wheat flour) mostly exhibited relative stability or mild (less than +/- 10%) monthly changes in local currency terms. Year-on-year comparison indicates mixed trend patterns: there were mild price changes in most regions of the country in July and August for most of the food imports; prices have declined in Hiran due to increased humanitarian food distributions. The prices of all the food imports increased (12-35%) in Bay region in both July and August.
Livestock prices (for all species) changed at mild rates (less than +/- 10%) month-on-month in most regions of the country in July and August 2016. However, local quality camel prices declined moderately (10-15%) in Juba and Shabelle regions in July 2016. Milk prices (camel and cattle) generally exhibited mild monthly changes in most regions of the country. However, milk prices declined in Lower Shabelle (12-22%) in July and Middle Juba (14-15%) in August. Compared to a year ago, livestock prices were lower in most regions of the country in both July and August. In contrast, milk prices (camel and cattle) increased in most regions of the country in July and August apart from Lower Shabelle and Middle Juba regions where they dropped by 11-14 percent in August.
Labor (unskilled) wages either remained relatively stable or changed mildly (by less than +/- 10%) month-on-month in most parts of the country in both July and August 2016. However, labor wages in Lower Shabelle decreased by 12 percent in July 2016 due to reduced demand for farm labour in the context of a below average harvest. Annual comparison indicates mild to moderate increases in labor wages in most parts of the country in both July and August with the exception of Shabelle and Middle Juba regions where they decreased (9-17%) due to reduced agricultural labor demand as a result of poor Gu 2016 rainfall performance as well as increased conflict/insecurity causing trade disruption in these regions.
Terms of Trade (ToT) between daily labor wage and local cereals either remained stable month-on-month or changed by 1-3kg of cereals/daily labor wage in most parts of the country. ToT between goat and cereals changed at mild rates in most regions of the country. However, ToT increased (25-45 kg/goat) in Middle Shabelle in July and August 2016 as a result of reduced white maize prices. ToTs are lower compared to a year ago in most regions of the country in July and August.
Full REPORT HERE: market-update-august-2016
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