Zimpapers Logo

Oliver Kazunga, Senior Business Reporter
ZIMBABWE’S annual inflation for the month of July slowed down to 56,37 percent while month-on-month inflation also dropped to 2,56 percent from last month’s rate of 3,88 percent, latest data show.

The decline, which reflects a 50,27 percentage points from the June figures of 106,64 percent, is in line with the Reserve Bank of Zimbabwe’s (RBZ’s) target of 55 percent by end of this month. In its latest report, the Zimbabwe National Statistics Agency (Zimstat) said:

“The year-on-year inflation rate (annual percentage change) for the month of July 2021 as measured by the all-items Consumer Price Index (CPI) stood at 56,37 percent.

“This means that prices as measured by the all-items CPI increased by an average of 56,37 percent between July 2020 and July 2021.”

The drop in annual inflation from 837,53 percent is a milestone for Zimbabwe’s economic policy reforms, which has succeeded in slowing down price escalation, with the exchange rate also registering stability, experts say.

Similarly, the drop in the month-on-month inflation, said Zimstat, also means that prices as measured by the all-items CPI increased by an average rate of 2,56 percent from June to July 2021.

According to the agency, the month-on-month food and non-alcoholic beverages inflation stood at 2,5 percent in July shedding 0,70 percentage points on the June rate of 3,21 percent. The month on-month-non-food inflation rate stood at 2,60 percent, shedding 1,78 percentage points on the June rate of 4,38 percent.

The Reserve Bank has reaffirmed its commitment to sustaining the disinflationary path to the end of the year with the authorities targeting inflation of less than 25 percent with month on-month below three percent by year end.

Meanwhile, Finance and Economic Development Minister Professor Mthuli Ncube has said the recent 50 percent salary hike for civil servants will increase purchasing power but will not result in price increases. He said this was because the auctions governing the cost of foreign currency used for productive purposes and other inflationary pressures are receding.

The exchange rate is a major factor governing inflation but Prof Ncube hinted that the official market constituting around 95 percent of foreign currency trading in the country is stable. The black market was therefore, not a worrying factor when looking at inflationary pressures. — @okazunga.