Inflation up marginally

HARARE - Zimbabwe's annual inflation for August gained 0,18 percentage points on the July 2016 rate of –1,60 percent to close the month at –1,43 percent, latest figures show.

According to the Zimbabwe statistical agency, ZimStat, this means that prices as measured by all items Consumer Price Index decreased by an average of –1,43 percentage points between August 2015 and August 2016.

“The month on month inflation rate in August 2016 was –0,13 percent gaining 0,06 percentage points on July 2016 rate of –0,19 percent,” Zimstat said.

This comes as the country’s inflation is expected to remain broadly subdued in 2016.

Reserve Bank of Zimbabwe governor John Mangudya said the persistent weakening of the South African rand against major currencies, coupled with the low aggregate demand, are likely to continue exerting further downward pressure on domestic prices.

“On the other hand, the anticipated increase in electricity and communication tariffs, the upward movements in food prices emanating from the drought induced food shortfalls, and the resurgence of oil prices experienced since mid-January 2016, if sustained, are expected to induce inflationary pressures in the economy,” he said.

“In addition measures taken by the central bank, including the prioritisation of imports, are expected to restrict the importation of cheap finished goods and are likely to have a positive impact on inflation in the medium term,” he added.

Zimbabwe has since October 2014 plunged in the throes of negative inflation, a phenomenon that some analysts have referred to as deflation — a condition as devastating to an economy as hyperinflation, from which the country only emerged from just seven years ago.

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.