ZIMBABWE’S implied annualised inflation rate closed 2019 at 521%, defying authorities’ target to reduce it to at least 10-15%.
According to Zimbabwe National Statistics Agency (ZimStat) month-on-month inflation rate in December 2019 was 16,55%, shedding 0,91 percentage points on the November 2019 rate of 17,46%.
Using the Consumer Price Index (CPI) for December at 551%, annual inflation is estimated at 521 %.
Since government deferred the announcement of year-on-year inflation rate until February 2020, analysts have been using the CPI to calculate year-on-year inflation rate. Already companies have adopted a hyperinflation reporting standard – IAS 29.
When authorities officially published the inflation data last July it was at 175, 6% before soaring to 480 % in November last year, according to experts.
Economist John Robertson pointed out that the thriving foreign exchange black market has fuelled inflationary pressures, noting that authorities misfired when they predicted a lower inflation rate.
“Not much chance of prices coming down while the authorities permit the foreign exchange black market to carry on generating big profits for a few privileged people. I can’t imagine what the two-digit prediction was about. Prices increased by only 16,5% in December – just one month. In most countries, the authorities would be horrified if 16% was the annual inflation rate and their ruling party would be in danger of losing the next election,” he said.
“The ban was a joke. We can all work out what the annual figure is, but government seems to believe that we are all children and can be told to mind our own business. Every day, government insults the entire population,” Robertson said.
Prominent American economist, Steve Hanke who has constantly criticised Finance minister Mthuli Ncube (pictured)’s inflation rates as understatements claimed in October 2019 that Zimbabwe’s inflation stood at 591% while suggesting that the country must dollarise to bring back much-needed economic stability.
Equity Axis’ calculations based on ZimStat figures show that annual inflation rate in December 2019 stood at 521,16% up from 440,01% recorded in November 2019. — Fidelity Mhlanga/Equity Axis News