Annual inflation gains 0.18 percentage points
ZIMBABWE’S annual inflation gained 0.18 percentage points to -1,43 percent in August from the July rate of -1,60 percent, data from the Zimbabwe National Statistics Agency (Zimstat) shows.
Zimstat said on a monthly basis, the inflation rate stood at -0.13 percent gaining 0.06 percentage points on July rate of -0.19 percent.
“The year-on-year inflation rate for the month of August 2016 as measured by the all items Consumer Price Index (CPI) stood at -1.43 percent, gaining 0.18 percentage points on the July 2016 rate of -1.60 percent,” it said.
This means that prices as measured by all the items CPI decreased by an average of -1.43 percentage points between August 2015 and August 2016, said Zimstat.
The year-on-year percentage points gain on the rate of inflation is due to a slight increase in fuel price last month resulting in basic commodities prices increasing.
According to the Consumer Council of Zimbabwe, the cost of living for low income urban earner monthly basket for a family of six increased from the July figure of $567,91 to $571,14 in August 2016.
The food basket increased by 1,73 percent from $122,60 by end of July 2016 to $124,72 last month.
The consumer watchdog attributed the slight shift in prices to various factors including the current cash shortages, the schools opening and fluctuating fuel prices.
Zimbabwe’s inflation has been in deflation since February 2015 due to persistent limited consumer spending.
Deflation is when the economy’s rate of inflation goes below zero. Economists have however, insisted that the prevailing negative inflation was correctional as it forced companies to re-adjust for goods and services that were set at a premium when the country adopted the multi-currency system in February 2009.
Although the annual inflation slightly moved from deflation by 0,18 percentage points last month, economic commentators have projected that the deflationary environment would persist going forward owing to depressed demand.