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Zimdollar hits new low

by Staff reporter
08 Apr 2023 at 07:38hrs | Views
Prices of nearly all basic goods skyrocketed this week as the Zimbabwe dollar plunged in value to a record low, leaving disposable incomes dwindled, Business Times can report.

The jump in prices comes at a delicate moment for Zimbabwe after annual inflation slowed to 87.6% in March from 92.3% in February this year.

This has been a major blow mainly to millions employed in the civil service who have had their recent paltry pay rise affected leaving their situation dire and now demanding more from the government.

As the local currency continues to lose value against all major currencies, at the auction system, the Zimbabwe dollar this week plunged to ZWL$944.71:US$1 from ZWL$671: US$1 in January this year. On the parallel market the Zimbabwe dollar was this week trading at between ZWL$1 600:US$1 and ZWL$1 700:US$1.

The spike in prices comes as Zimbabwe heads to the polls, possibly in August, which could force authorities to intervene, with disastrous consequences.

A survey by Business Times this week shows that the cost of a 2-litre bottle of cooking oil had risen to ZWL$4 749.99 from ZWL$3649.99 last week while bread was this week selling at ZWL$1 399.99 from ZWL$989.

A 2 litre Mazoe drink is now selling at ZWL$4 149.99 from ZWL$3 600 last week.

A 10kg roller meal is selling at between ZWL$6 999.99 and ZWL$8 999.99 from ZWL$5899.99 last week.

A 2kg pack of rice and a bar of soap are now selling at between ZWL$2199.99 and ZWL$3899.99 and ZWL$1349.99 from ZWL$1 600.99 and ZWL$984.99 respectively.

A kg of beef jumped to ZWL$6 899.99 from ZWL$4132.99 last week while a kg of chicken has soared to ZWL$6 499.99 from ZWL$4189.99.

In an interview with Business Times yesterday, the Consumer Council of Zimbabwe executive director Rosemary Mpofu said the situation was adversely impacting on consumers as prices have gone up in both ZWL$ and US$.

"The cost of living as measured by the CCZ's low-income urban earner monthly basket for a family of six increased ZWL$489 831 by end of March from a figure of ZWL$441 036 by the end of February, showing an increase of ZWL$48 795.

"The reasons for the increase varied from localised high inflationary pressures, exchange rate volatility, and external factors. Even with smaller denominated gold coins, trying to curb inflation amid a slump in the country's currency, we still noticed a huge change in prices," Mpofu said.

She added: "We see a lot of activity on the parallel market exchange rate which was a major factor in driving inflation. In terms of the US$ basket, we also noticed a huge change as the basket moved to US$478.82 from US$507.67.  This was a huge increase and it is not good for the consumers," she said.

Going forward, the government should come up with policies that support production.

"The manufacturing sector should be capacitated to increase production in the factories. This will reduce the cost of production and create a lot of jobs for the locals.

"The authorities should implement activities that support production."

The Zimbabwe National Chamber of Commerce president Mike Kamungeremu said rolling power cuts are exacerbating the situation.

"We are running generators everyday and the costs are very high, leaving us with no option but to pass on the costs to the consumers. This is the only way we can survive, otherwise, some businesses will close shop if they don't adapt," Kamungeremu said.

Source - businesstimes