Analyzing the Effects of Inflation on Household Living Conditions: Case Study of Mbala Central Constituency

The study aimed at analyzing the effect of inflation on household living conditions in Zambia. The data was collected from both primary and secondary. The population of study was specifically purposed on the households of Lusaka district. The study outlined three specific objectives, to ascertain the effects of inflation on household consumption expenditure, influence of inflation on household disposable income and effects of inflation on household savings. A descriptive research design was employed, with a sample size of 75 households selected through purposive sampling from a target population of 200 households. Primary and secondary data were collected using a questionnaire, and data analysis was performed using Stata. The results show that despite high inflation rates, household income was not significantly affected. The mean monthly income was ZMW 8,330.59, with a standard deviation of ZMW 2,514.19. However, savings were significantly affected, with only 40 households able to save, down from 51 households previously. The mean savings decreased from ZMW 3,120.59 to ZMW 2,049.00, with a standard deviation of ZMW 2,596.32. The study concludes that high income levels in Zambia have enabled households to maintain their purchasing power despite high inflation rates. However, savings have been significantly affected, with a decrease in the number of households able to save and a reduction in the mean savings amount. The study recommends that policymakers focus on implementing measures to reduce inflation and increase savings rates in Zambia.