Inflation more than doubles in October

Harare – Zimbabwe’s month-on-month inflation accelerated to 38.75% in October 2019, gaining 21.03 percentage points on the September 2019 rate of 17.72%.

This is the highest inflation since July 2019 in which the inflation rate was 21.0%.

Month-on-month inflation recorded rather surprising fall from a high of 39.3% in June 2019, with the downward trend continuing in August (18.1%), September (17.7%) until the recent spike in October.

According to Zimbabwe National Statistics Agency (ZIMSTAT), “this means that prices as measured by the all items CPI increased by an average rate of 38.75 percent from September 2019 to October 2019.”

The month-on-month inflation rate is given by the percentage change in the index of the relevant month of the current year compared with the index of the previous month in the current year.

The spike in October inflation was mainly due to the jump in the index of the heavily weighted Food and Non Alcoholic Beverages at 48.35% in October, gaining 28.80 percentage points on the September 2019 rate of 19.55%.

Meanwhile, the month on month non-food inflation rate stood at 32.90%, gaining 16.27 percentage points on the September 2019 rate of 16.63%.

“The CPI for the month ending October 2019 stood at 402.92 compared to 290.39 in September 2019,” ZIMSTAT said.

Zimbabwe is currently going through a period of economic slide, with GDP set to contract by between -6.5% and -10% in 2019.

Finance Minister Professor Mthuli Ncube suspended the reporting on year on year inflation to enable ZIMSTAT to collect more data to compare the price statistics on a like-to-like basis.

This move has received its fair share of criticism and other independent organisations continued to publish year on year inflation.

Year on year inflation calculated based on ZIMSTAT figures stood at 353% as at September 2019.

Prominent American Economist, Professor Steve Hanke has since maintained that Zimbabwe’s year on year inflation is now past 500%.

In his 2020 National Budget, Ncube said that the government is targeting single digit month on month inflation to a low of 2%.

Equity Axis News

Raynold Mhotseka

Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment. He can be contacted through the following email links, rayjnr.mhotseka@gmail.com and raynoldm@equityaxis.net.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.