BY MTHANDAZO NYONI
The recent spate of price increases has seen a decline in disposable incomes and a drastic plunge in retail volumes, an industry official has said.
Confederation of Zimbabwe Retailers president Denford Mutashu told NewsDay that retailers were now feeling the heat of inflationary pressures.
According to a Consumer Council of Zimbabwe survey conducted between March 22 and April 2, all provinces recorded price increases, with Manicaland topping the list.
“The volumes of products pushed by the sector have declined owing to low disposable incomes, as prices have shot up beyond the reach of ordinary citizens. Inflationary pressures have been mounting against stagnant or eroded incomes,” he said.
Official statistics from the government agency put the country’s inflation at 59% in February, but developments on the group show that the cost of basics has gone up, in some instances by more than threefold.
Mutashu said retailers were still struggling to source forex despite the establishment of the interbank market.
“The foreign currency situation has not improved significantly as both the interbank bank and the grey market forex rates have been crawling up due to limited supply,” Mutashu said.
The Reserve Bank of Zimbabwe scrapped its discredited 1:1 dollar peg for surrogate bond notes and electronic dollars last month, merging them into a lower-value transitional currency called the RTGS dollar and an interbank market for foreign currency as part of monetary policy measures to address the country’s currency challenges.
The RTGS made its debut at 2,5: 1 to the greenback on the official interbank platform, but it has dipped to trade at 3,1 to the dollar.
On the parallel market, the RTGS dollar is in the region of 4:1.