Zim inflation gains further

HARARE - Zimbabwe's year-on-year inflation continues to surge ahead after gaining 0,37 percentage points on the September 2016 rate of -1,33 percent to close October at -0,95 percent, latest figures show.

Data released by the country’s statistical agent, Zimstat, yesterday revealed that prices as measured by the all items in the Consumer Price Index decreased by an average of -0,95 percentage points between October 2015 and October 2016.

“The year-on-year food and non-alcoholic beverages inflation prone to transitory shocks stood at -2,03 percent whilst the nonfood inflation rate was -0,45 percent,” Zimstat said.

The month-on-month inflation rate in October 2016 was 0,09 percent gaining 0,35 percentage points on September 2016 rate of -0,26 percent.

The increase in annual inflation rate comes at a time the central bank predicted that inflation was expected to remain broadly subdued in 2016 due to depressed demand.

“On one hand, 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,” Reserve Bank of Zimbabwe governor John Mangudya said recently.

He noted that 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 on the economy.

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