HomeBusinessInflation slows again, as prices rocket

Inflation slows again, as prices rocket

-

ZIMBABWE’s year-on-year inflation rate dropped to 401,66% in November, from 471% the previous month, data released by the Zimbabwe National Statistics Agency (ZimStat) yesterday shows.

BY FIDELITY MHLANGA

This means prices, as measured by the all items consumer price index (CPI), increased by an average of 401,66% between November last year and November 2020.

Data on pricing trends was collected between November 12 and 18, according to a statement by ZimStat.

The agency did not state the reasons behind the slowdown.

Year-on-year inflation reached a post-dollarisation zenith of 837,53% in July, much to the chagrin of authorities who then instituted a raft of measures to douse the flame.

In August, inflation eased to 761,02% after one of the sources of growing inflation, the forex exchange parallel market was tamed when the central bank intensified a clampdown on mobile money agents and other digital money transfer platforms.

Government also suspended trading on the Zimbabwe Stock Exchange in June, accusing the bourse of fuelling inflation, before reopening it in August.

However, there has been debate about the accuracy of inflation data.

Government has been saying the inflation rate has been slowing down, while the cost of living has generally been increasing.

Last month, ZimStat said the monthly cost of living rose by 4,4% to $18 750 in October, from $17 956,87 in September.

So steep were price hikes during the period that in Matabeleland North, consumers required up to $20 679 for a family of five to pull through.

There has been no let up on price hikes across the country since then. Normally an inflationary slide means that prices are stabilising.

Escalating living expenses exert pressure on thousands of Zimbabweans who have been thrown out of jobs after an intensification of de-industrialisation in the past year.

Over one million more Zimbabweans joined the jobless ranks this year after blanket firm shutdowns were effected by government to prevent contagion as the deadly COVID-19 pandemic tore through provinces. But even those formally employed will feel the heat.

Very few workers currently earn over $14 500 because companies are struggling to stay afloat due to diminished demand precipitated by a gruelling economic crisis.

The least paid civil servant earns about $14 500.

Experts say millions of Zimbabweans living in rural areas will sink into abject poverty as steep rises in basic commodity prices erode their already over-stretched buying power following the prolonged economic crisis.

“The TCPL (total consumption poverty line) for an average of five persons stood at $18 750,35 in October 2020,” ZimStat said in November.

“This means that an average household required that much to purchase both food and non-food items for them not to be deemed poor. This represents an increase of 4,4% when compared to the September 2020 figure of $17 956,87. In September, a family of five needed $17 956,87 not to be deemed poor,” ZimStat said, adding that the TCPL for Zimbabwe stood at $3 750,07 per person in October 2020.

This means an individual required that much to purchase both non-food and food items as at October 2020 in order not to be deemed poor, and it represents an increase of 4,4% when compared to the September 2020 figure of $3 591,37.

Follow Fidelity on Twitter @ FidelityMhlanga

Recent Posts

Stories you will enjoy

Recommended reading