Zimbabwe’s year-on-year inflation stood at minus 7.7 percent in December 2009 as the adoption of multiple foreign currencies by the unity government earlier in the year ended hyperinflation. Respected Harare-based economic consultant John Robertson said this week that beginning from April this year the negative numbers would start moving quickly into less comfortable positive inflation rate figures.
Because of the contrast against the low index numbers reached by June 2009, it appears likely that the rate by June 2010 will reach or exceed five percent, Robertson said. He observed that most of the declines that have occurred in prices of commodities since last year were due to misaligned foreign currency values that existed at the beginning of 2009 and for many months before the end of 2008. Shopkeepers also had to depend on cross-border traders, most of whom were unable to obtain the commodities food at wholesale prices. These costs however came down as the year progressed when local shops were able to place direct orders with South African wholesalers and manufactures.
For these reasons, the first four months of 2009 might best be seen as periods of adjustment, and when we have put the first four months of 2010 behind us, the year-on-year inflation figures from then will have more meaning, Robertson said. The Central Statistical Office (CSO), which started calculating price increases in United States dollars last December, published annualised inflation data for the first time on January 15. Zimbabwe’s inflation peaked at 500 billion percent as Zimbabwe’s decade-long political and economic crisis reached its height in
December 2008
Post published in: Economy