BY MBONGENI NDLELA
MBABANE – Eswatini’s cost of living has continued to show signs of stability after headline inflation eased to 2.6 percent in June 2026, marking the second consecutive monthly decline and offering encouraging news for households, businesses and policymakers.
The latest Consumer Price Index (CPI) Report released by the Central Statistical Office (CSO) under the Ministry of Economic Planning and Development shows that inflation dropped from 2.7 percent in May 2026 and is also lower than the 2.9 percent recorded in June 2025.
The latest figures suggest that while prices for many everyday goods and services continue to rise, they are doing so at a slower pace than they were a year ago, signalling a more stable inflation environment.
For ordinary emaSwati, lower inflation means the purchasing power of their money is being eroded more slowly than before. While prices are not necessarily falling, they are increasing at a more moderate rate, making it easier for families to plan household budgets.
Economists generally view moderate inflation as a sign of a healthy economy because it encourages spending and investment while avoiding the damaging effects of rapid price increases.
GOODS STILL RISING FASTER THAN SERVICES
The report indicates that prices of goods increased by 3.1 percent over the past year, while services recorded a more modest increase of 1.8 percent.
Among the major sectors, Transport recorded one of the strongest annual increases, rising to 4.2 percent, reflecting higher costs associated with travel and vehicle-related expenses.
The Restaurants and Hotels category also experienced higher inflation, climbing to 2.8 percent, suggesting consumers continue to pay more for accommodation, dining and hospitality services.
Meanwhile, inflation for Alcoholic Beverages, Tobacco and Narcotics slowed to 3.2 percent, indicating that price increases in this category have moderated compared to previous months.
MONTHLY PRICES REMAIN LARGELY STABLE
On a month-to-month basis, inflation stood at just 0.1 percent between May and June 2026.
This indicates that prices across the economy remained largely stable during the month.
The report notes that price declines were recorded in Restaurants and Hotels, Transport, and Housing, Water, Electricity, Gas and Other Utilities. These decreases helped offset increases in other categories and contributed to the overall moderation in headline inflation.
WHAT DROVE THE JUNE INFLATION RATE?
Although inflation eased overall, some categories continued to contribute significantly to the national inflation rate.
According to the CSO, the biggest contributors to the 2.6 percent headline inflation were: Housing, Water, Electricity, Gas and Other Fuels (1.7 percentage points); Transport (0.7 percentage points); and Clothing and Footwear (0.3 percentage points).
Housing-related costs remain the largest driver of inflation, highlighting the continued importance of utility charges, housing expenses and energy costs in determining household spending patterns.
POSITIVE SIGNAL FOR THE ECONOMY
The latest inflation figures provide another encouraging signal for Eswatini’s economy.
Stable inflation creates a more predictable business environment, allowing companies to plan investments and manage operating costs more effectively. It also supports consumer confidence by reducing uncertainty about future price movements.
The moderation in inflation could also provide policymakers with greater flexibility when considering future economic and monetary policy decisions aimed at supporting growth while maintaining price stability.
WHY THE CPI MATTERS
The Consumer Price Index is one of the country’s most important economic indicators because it measures changes in the average prices paid by consumers for goods and services over time.
Government uses the CPI to guide economic planning and fiscal policy, while the Central Bank closely monitors inflation trends when making monetary policy decisions.
Businesses also rely on CPI data when reviewing pricing strategies, negotiating supply contracts and adjusting employee salaries.
For workers, organised labour and employers, inflation figures often play a key role during wage negotiations because they indicate how much the cost of living has changed.
Financial institutions, investors and development partners equally use inflation data to assess the country’s economic performance and stability.
SUPPORTING SOUND ECONOMIC DECISIONS
Officials say the latest CPI report provides valuable insight into the direction of the economy and helps government, businesses and citizens make informed financial decisions.
With inflation remaining relatively low by historical standards, Eswatini continues to maintain a stable price environment that supports sustainable economic growth while helping protect household purchasing power.
The full June 2026 Consumer Price Index Report is available from the Ministry of Economic Planning and Development via the Government of Eswatini website.
