HARARE – Zimbabwe’s annual inflation surged to 97.85 percent in May from 75.86 percent the previous month, continuing to gallop on the back of price instability driven by depreciation of the local currency, latest figures released on Monday show.
According to the Zimbabwe National Statistics Agency (ZimStats) the jump was primarily a result of increases in the prices of food and non-alcoholic beverages, clothing and footwear, health and transport.
On the other hand, month-on-month inflation gained 7.02 percentage points to close the month of May at 12.54 percent.
“This means that prices as measured by the all items CPI (Consumer Price Index) increased by an average rate of 12.54 percent from April 2019 to May 2019,” Zimstats said.
This is the fourth consecutive rise in month-on-month inflation since February this year.
An unsteady exchange rate, which has seen the local currency depreciate against the United States dollar on both the official and parallel markets in the past few months, has continued to fuel pricing “madness”, which has seen retailers and other service providers on a continuous hiking spree.
While the local currency is trading at US$1: RTGS$6 on the official market, on the parallel market is it now close to US$1: RTGS$10, a depreciation of around 50 percent in the last three months.
The government, which has said it will not resort to price controls, has accused local businesses of being greedy and speculative by using the black market exchange rate as the basis for pegging prices.
But business insists it is cushioning itself from exchange losses.
Fiscal authorities have said they are working on measures to bring sanity in the economy that will not only see stability in prices but a decline in inflation from October this year. – New Ziana