Zimbabwe inflation drops to 471,25%


ZIMBABWE’S annual inflation rate dropped to 471,25% in October from 659,40% in September, according to latest data from the Zimbabwe National Statistics Agency (ZimStat).

The annual inflation rate was 761,02% in August and 837,53% in July.

The data reflects that prices are stabilising in line with the stability being enjoyed by the Zimbabwe dollar against major currencies.

The month-on-month inflation rate was 4,37%, up 0,54 percentage points from September’s 3,83%.

The drop in the inflation rate was largely due to the foreign currency auction introduced in June this year and held weekly by the Reserve Bank of Zimbabwe.

The auction has helped stabilise the Zimbabwe dollar which averages US$1:$81.

This has also resulted in the increased availability of forex which has slowed down the rate on the parallel market, which is around US$1:$120.

The drop in the inflation rate was also due to measures taken by the Treasury and central bank to curb illicit activities on the forex parallel market.

As the parallel forex rate is largely regarded as the true foreign currency exchange rate by the market, authorities significantly cut down on daily monetary transactions and virtually eliminated mobile money agencies which greatly reduced parallel market activity thereby controlling the Zimbabwe dollar.

Source – newsday