• WAEMU posts 0.9% deflation in July, second month in a row
• Food, hospitality prices drop; alcohol, education costs rise
• Niger sees sharpest deflation; BCEAO keeps growth outlook strong

The West African Economic and Monetary Union (WAEMU) recorded a deflation rate of 0.9% in July, marking its second consecutive month of deflation after a -0.2% rate in June, according to the latest report from the Central Bank of West African States (BCEAO), published on Thursday.

The deflation was primarily driven by falling prices for food products, which make up a significant portion of household consumption, as well as in the restaurant and hotel sectors. However, the alcoholic beverages, tobacco, and narcotics category saw its highest rate of the year at 2.9%, while the education sector also experienced price increases.

Five of the eight WAEMU countries saw deflation in July, up from three the previous month. Niger recorded the highest deflation rate at -9.1%, its third consecutive month, reflecting a sharp drop in product prices. Although Mali's inflation rate decreased to 4.8% from 5.3% in June, it remained the highest in the monetary union.

These figures follow a two-year low for WAEMU's inflation rate of 0.6% in May. These rates are well below the central bank's target range of 1% to 3%. The BCEAO attributed the trend to better-supplied markets and a decline in the prices of imported goods.

In June, the BCEAO lowered its key policy rate by 25 basis points to 3.25% to maintain macroeconomic stability amid persistent external uncertainties. The bank forecasts that growth will remain strong, reaching 6.4% in 2025, up from 6.3% in 2024.

Lydie Mobio