Prices of local products rising

Prices of locally produced goods are seen rising as manufacturers pass the cost for excise duty on fuel to consumers, analysts have warned.

MMC Capital says in its weekly market report it is their view that the revenue measures, from Treasury, paint a murky picture of Zimbabwe in the short to medium term. The increase in excise duty on fuel will likely increase the cost burden for most companies.

Companies, under normal circumstances, will have to pass that cost to consumers in a bid to maintain profitable margins.

In Zimbabwe, however, consumers are already reeling under falling disposable incomes, hence presenting challenges for companies to increase their selling prices.

They said that in an environment where companies are already reducing prices to encourage sales, the rise in fuel cost will result in a further squeeze in margins.