Rent hike fears pose threat to inflation

Finance Minister Robinson Githae’s decision to make all landlords tax compliant is bound to result in inflation rate staying high or even going up, hence undermining efforts that has seen the rates gradually come down over the last two months.

The unfolding timid situation is informed by the big chunk that housing spend account in the consumer price index. The weight of housing in the consumer price inflation basket is only second to spending on food and has the potential to fuel inflation if there is a major price change in rent charges. Consumer Price Index (CPI) is the measure of the weighted aggregate change in retail prices paid by consumers for a given basket of goods and services.