Zim inflation rises in June

July 20, 2009
Shares

, HARARE, Jul 20 – Prices in Zimbabwe rose in June, ending four months of deflation that followed the scrapping of the local currency, the government said Monday.

After a decade of hyperinflation that soared into multiples of billions, Zimbabwe\’s government abandoned its currency in January.

The government now calculates inflation based on US dollar prices, which have been falling all year.

In June, the monthly inflation rate registered at 0.6 percent, against -1.0 percent in May.

Food prices, however, remained deflationary, with food and non-alcoholic beverages at -1.26 percent, against -0.84 percent in May, the Central Statistics Office said.

Non-food inflation was at 1.45 percent, compared with -1.05 percent for May.

Since trading in foreign currency was allowed, Zimbabwe\’s once-deserted shops are again fully stocked with food.

But even with food prices falling, few people can afford to buy food in a country where the unemployment rate is estimated at 94 percent.

Once a regional breadbasket, Zimbabwe\’s economy has shrunk more than 40 percent over the past three years.

The unity government formed in February between long-ruling President Robert Mugabe and his one-time rival Prime Minister Morgan Tsvangirai is trying to convince donors to give 8.5 billion dollars to revive the economy and the civil service.

Last week Finance Minister Tendai Biti predicted that the country\’s economy will grow by 3.7 percent this year and ruled out a return of the Zimbabwe dollar.

 

Shares

Latest Articles

Stock Market

Most Viewed