Zim inflation continues to decline

by Staff reporter

2012 June 20 10:05:55 | 2106 Views

Economic analysts say the country is set to meet the annual inflation rate target of around 5% given the slow-down in year on year inflation rate which stood at 4.03% for the month of May.

The country's annual inflation which for last year was the least within the SADC region at 4.9% continues to decline with the latest figures from the Zimbabwe Central Statistical Agency showing that the inflation rate declined from 4.03 in April to 4.02 in May 2012.

The year on year inflation rate for the month of May 2012 as measured by the all items Consumer Price Index (CPI) stood at 4.02% having shed 0.01 percentage points on the April 2012 rate of 4.03%.

The latest figure means that prices as measured by the all items CPI increased by an average of 4.02 percentage points between May 2011 and May 2012.

Economic analyst, Mr. Willie Ganda expressed optimism that the country is on course to meet the 2012 annual inflation rate target of around 5%.

"The inflation figures remain positive and we are definitely on course to attain the envisaged 5% target by year end. However, we need to be wary of the inflationary pressures which normally come with the June salary reviews," said Mr. Ganda.

Meanwhile, the month on month inflation rate in May 2012 was 0.07% shedding 0.12 percentage points on the April 2012 rate of 0.19%.

The inflation figures are reflective of the stable operating environment brought about by the adoption of the multicurrency regime and sound macroeconomic policies.

Within the region, South Africa's inflation rate has remained at around 6% while Botswana's was around 7.7% as of May this year.

For Zimbabwe which is targeting a single digit inflation rate under the Medium Term Plan, economic experts warn that failure to introduce sound macro policies aimed at increasing cash inflows within the economy will hinder efforts to consolidate economic gains.

Inflation

Source: zbc