HomeNewsInflation spike to hit low-income earners the most

Inflation spike to hit low-income earners the most

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The poorest continue to bear the brunt of an increasing basic commodities-breadbasket as officials reported that Zimbabwe’s inflation increased by 0,1% in October with the breadbasket picking 0,06% in the same month.

An economist has noted that although year-on-year inflation is decreasing, the cost of living continues on an upward trend, affecting mostly low-income earners.

According to statistics released by the Zimbabwe National Statistics Agency (Zimstats) the country’s year-on-year inflation slowed down by 0,6%.

Economist Eric Bloch said: “There are a lot of things outside the breadbasket that are factored into inflation such as entertainment. It is unfortunate for low-income earners who need basic commodities to survive,” he said.

Zimstats reported that the Consumer Price Index (CPI) for October stood at 95,3 points compared to 95,1 points in September and 92 points in October last year.

The Consumer Council of Zimbabwe (CCZ) said for the month of October, the cost of living, as depicted by its low-income urban earner monthly basket, showed a marked increase from $483,88 in September 2010 to $491,28 reflecting a 0,02 % increase for a family of six.

According to CCZ, The food basket increased by 0,06% from $129,56 in September 2010 to $136,76 in October 2010 and the food and detergents basket has increased from $139,88 in September to $147,28 in October 2010 reflecting a 0,05 % increase.

Said CCZ director Rosemary Siyachitema: “For some time now, the rand has been very strong against the US dollar, but CCZ is concerned that the increase in the food basket may be attributed to the traditional behaviour of supermarkets of increasing prices towards the festive season, taking advantage of that little bonus workers will receive in November, a behaviour which CCZ abhors.

“ One also has to consider that supermarkets have not responded positively to giving consumers change. The problem of change needs to be addressed urgently so as not to inconvenience consumers who need every cent they can have for transport and other needs,” she said.

Siyachitema noted that the cost of the CCZ basket for transport, rent, water and electricity, health, education, clothing and footwear had remained the same at $344.

“There is still a challenge in the area of water supply where a number of households are still dry. CCZ wants to see all households receiving actual bills or at least bills generated from meters read every quarter. Consumers are still concerned about high utility bills which are being received in most areas. The situation has continued to reduce the disposable income of low-income urban earners as most of their money is being directed to these bills,” she said.

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