Inflation continues to slide

via Inflation continues to slide | The Herald May 16, 2015

The annual inflation rate for March 2015 shed 1,45 percentage points to minus 2,45 percent in April, as the effect of tight liquidity, strong dollar and weak rand on prices remained strong.

The Zimbabwe National Statistics Agency (ZImStat) said this means prices, as measured by Consumer Price Index, decreased by an average of 2,45 percent between April 2014 and April 2015.

The year-on-year food and non-alcoholic beverages inflation prone to transitory shocks, stood at minus 2,93 percent while the non-food annual inflation rate was minus 2,51 percent.

ZimStat said in its report yesterday that month-on-month inflation in April was minus 0,89 percent, shedding 0,86 percentage points on the March 2015 rate of minus 0,03 percent.

“This means that prices as measured by the all-items CPI decreased at an average rate of minus 0,89 percent from March 2015 to April 2015,” ZimStat said it its CPI report for April.

Inflation refers to the rate at which prices of goods and services fall or rise over a given period, usually over a year or month.

The monthly food and non-beverages inflation was minus 0,63 percent in April from minus 0,03 percent in March. The month on non-food inflation rate stood at minus 1,01, shedding minus 0,99 percent on the March rate of minus 0,03 percent.

Zimbabwe’s annual and monthly rates of inflation remain under pressure due to tight liquidity, which limits price elasticity of goods and services.

The use of the greenback means prices remain low as importing remains markedly cheaper.

Further, the weakening rand means Zimbabwe also imports from South Africa, which is the country’s biggest trading partner, using less and less of the greenback.