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Zimbabwe annual inflation drops by 55,3pc

by Staff Reporter
29 Jun 2021 at 11:05hrs | Views
THE country's annual rate of inflation for the month of June 2021 dropped by about 55,3 percent to 106,64 percent from 162 percent, the Zimbabwe National Statistics Agency (Zimstat) has revealed.

Annual inflation has of late been falling with the Reserve Bank of Zimbabwe (RBZ) projecting it will recede to 55 percent by next month.

"The year-on-year inflation rate (annual percentage change) for the month of June 2021 as measured by the all-items Consumer Price Index (CPI) stood at 106,64 percent," it said.

In its latest report, Zimstat also indicated that the month-on-month inflation rate in June 2021 was 3,88 percent gaining 1,34 percentage points on last month's rate of 2,54 percent.

Zimbabwe's month-on-month inflation rose rapidly through 2019 and in the first eight months of 2020 before the auction system kicked in with exchange rate stability, which has seen inflation pressures slowing down.

By next month, monetary authorities expect all the 12 monthly jumps in the annual inflation calculation to be from lower margins hence the prediction of 55 percent.

The Reserve Bank's Monetary Policy Committee has reaffirmed its commitment to sustaining the disinflationary path to the end of the year.

In addition, the committee has also reaffirmed its strong commitment to continue with the conservative monetary policy stance to ensure price stability in the market is maintained.

Meanwhile, the monetary authority has indicated that reserve money as at week ending June 18, 2021, fell by ZWL$176,84 million to ZWL$23,85 billion compared to last week's position of ZWL$24,02 billion.

The decrease in reserve money largely reflected a decrease of ZWL$378,06 million in banks' liquidity (RGTS balances) at the Reserve Bank, which was partially offset by increases of ZWL$125,35 million and ZWL$75,87 million in currency issued and required reserves respectively.

"The fall in liquidity followed an increase in revenue collection by the Government, which saw its deposit at the RBZ rising by ZWL$1,19 billion over the week under review, thus withdrawing liquidity from the market," said the Central Bank.

Source - Chronicle