The month on month inflation rate measure for August 2019 showed a significant slow down in the measure, with a decline to 18.07% down from the previous months 21.04%. Year on year inflation, however, continued its gallop rising to another post-2009 high of 288.5%. Up from 230.54%in the month of July.
The official inflation figures are disputed with academic Steve Hanke using his own method which places the year on year inflation rate well over 500%. Zimbabweans on the street would also dispute the figures on the basis that the month on month slowdown does not reflect the situation they face on the ground as prices continue to rise and faster.
Food inflation year on year stands at 252%, doubling the previous month’s food inflation of 126%. Other key push factors in the inflation rate were transportation which went up by 222%. This is reflective of the reaction to ZERA’s policy towards fuel pricing in which they update the price weekly and transport operators react. Even the generally steady housing inflation increased by 10%.
The irony of all these developments comes after Reserve Bank Governor John Mangudya in presenting the mid-term monetary policy claimed that inflation had been brought under control. Those with good memories will also remember Finance Minister Professor Mthuli Ncube proclaiming that prices will start to decline in October. While this was the minister taking advantage of mathematical knowledge the current inflation developments mean that may not even come to pass.
The current team have been at it for a year now. We have seen a lot of action but very little change in the desired direction. While surpluses have been generated in government coffers the conditions in which Zimbabweans live and try to conduct business have only worsened.