In a recent radio interview, Sierra Leone’s Finance Minister, Sheku F. Bangura, highlighted significant progress in the country’s inflation management, reporting an 18% reduction in inflation rates from 54% in October 2023 to approximately 30% as of May 2024. Minister Bangura emphasized that inflation is a crucial economic indicator that directly affects the cost of living and the prices of goods and services.

Bangura attributed the reduction in inflation to a series of strategic measures implemented both on the fiscal front and by the central bank. These initiatives include adjustments in monetary policy and fiscal controls aimed at stabilizing the economy. Despite this progress, he acknowledged that inflation remains a concern, though the downward trend is encouraging.

When questioned about the persistence of high prices for basic commodities, despite the overall decrease in inflation, Bangura responded that while essential items like petrol, onions, and spices are seeing price reductions, other goods such as rice have experienced only modest changes. He explained that the price of rice, a staple commodity, has increased by about 4 percentage points but is not considered excessively high relative to previous levels. The variance in rice prices is influenced by the variety and market fluctuations.

Minister Bangura also addressed concerns about the impact of fuel prices on overall inflation. He noted that fuel prices have a broad influence on other costs due to their effect on transportation and, subsequently, on the prices of goods like pepper. However, he assured that prices of key items are generally trending downwards, which should help ease the cost of living.

Regarding the relationship between inflation and exchange rates, Bangura highlighted that Sierra Leone’s currency has remained stable and even appreciated against the dollar and other currencies. This stability, he explained, is crucial for controlling inflation as it impacts the prices of imported goods and commodities. The government’s policy measures, including allowing more flexibility in foreign currency trading, have contributed to this stability.

The Minister also acknowledged that while the inflationary trend shows promise, the full effects of the current measures on inflation may take some time to manifest fully. He assured that the government remains committed to continuing its efforts to stabilize the economy and manage inflation effectively.

Overall, Bangura’s statements reflect a cautious optimism about Sierra Leone’s economic trajectory, with a focus on maintaining stability and addressing the challenges of inflation through ongoing policy adjustments and strategic interventions.