Cape Verde Inflation Rises to 1.5% Amid Global Tensions
Cape Verde’s inflation rate reached a 12-month average of 1.5% in September, marking a 0.2 percentage point increase from the previous month, according to the latest data released by the archipelago’s National Institute of Statistics (INE).
Rising Prices and Core Inflation
The year-on-year variation of the Consumer Price Index (CPI) climbed to 2.7% in September, a significant jump of 1.6 percentage points compared to August. Meanwhile, the core inflation indicator—which excludes volatile sectors such as energy and unprocessed food—stood at 1.5%, up 1.2 percentage points from the same period last year.
Economic Outlook and Global Pressures
The recent figures align with a shifting economic forecast from the Bank of Cape Verde (BCV). In May, the central bank revised its annual inflation estimate upward from 1.7% to 2.7%, citing the “escalation of geopolitical tensions,” particularly the ongoing instability in the Middle East, as a primary driver of rising costs.
International organizations and government officials have also adjusted their expectations for the island nation’s economy:
- The International Monetary Fund (IMF): Forecasts a 1.2% inflation rate for this year, rising to 2.8% by 2027.
- The Cape Verdean Government: Has set a target of 2% average annual inflation in its 2027 State Budget.
Cape Verde previously closed 2025 with an inflation rate of 2.3%. The current upward trend highlights the continuing impact of global market volatility on the small island economy.
Image: Pexels – Nico Marín
