Business / Economy
Zim deflationary pressures persist in November
15 Dec 2014 at 15:48hrs | Views
Zimbabwe's inflation eased to -0.78% year-on-year in November, shedding 0.78% on the October rate of -0.001% as deflationary pressures persist, the official statistics agency Zimstats said on Monday.
The monthly inflation rate fell to -0.69%, shedding 0.58% on the October rate of -0.11%.
Zimbabwe has maintained a single digit inflation figure since 2009.
A closer look at the Consumer Price Index components showed that deflationary pressures have been stronger in traded sectors suggesting that pass-through from a depreciating Rand also played an important role.
Deflation may increase the burden of existing debt in the country which was already under financial stress. Zimbabwe's both domestic and external debt now stands at $9,9 billion according to official statistics.
The country owes creditors that include the IMF, World Bank and the Paris Club among others.
The Bretton Woods institution said deflation would hurt producers and might reduce the country's capacity to produce as it leads to widespread company downsizing and closures due to downward wage rigidity.
Zimbabwe first registered deflation this year in February of -0,49 since the use of the multi-currency regime in 2009.
The monthly inflation rate fell to -0.69%, shedding 0.58% on the October rate of -0.11%.
Zimbabwe has maintained a single digit inflation figure since 2009.
A closer look at the Consumer Price Index components showed that deflationary pressures have been stronger in traded sectors suggesting that pass-through from a depreciating Rand also played an important role.
The country owes creditors that include the IMF, World Bank and the Paris Club among others.
The Bretton Woods institution said deflation would hurt producers and might reduce the country's capacity to produce as it leads to widespread company downsizing and closures due to downward wage rigidity.
Zimbabwe first registered deflation this year in February of -0,49 since the use of the multi-currency regime in 2009.
Source - Byo24News
