Prices in sharp increase

HARARE - Zimbabwe witnessed the sharpest increase in average prices in September since it adopted the multi-currency regime in 2009, which was biased towards the US dollar, a leading financial research firm has said.

According to official Zimstat data, year-on-year inflation rose by 0,78 percent in September up from 0,14 percent in August.

The adoption of the strong US dollar had ensured low and managed inflation although having a downside of deflation and low export competitiveness.

“The swelling of Zimbabwe’s RTGS balances unmatched by plummeting cash and cash equivalents, has resulted in steep parallel market discounting and fuelled a spontaneous increase in average prices of goods,” financial research firm Equity Axis has said.

“Prices have in turn gone up by between 50 percent and 100 percent over the past 8 weeks and official inflation data for the month of October is expected to capture that drift.

“It is our persuasion that prices of goods will remain guided by the monetary developments such as parallel exchange rates and the general liquidity situation in the economy.”

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.