Zimbabwe’s inflation rate has slowed to 240.55% in March from 321.59% in February, the Zimbabwe National Statistics Agency(ZIMSTAT) has revealed in its Consumer Price Index(CPI) for the month of March.
Last year, the monthly food inflation reached a peak of 38% but a drastic inflation fall to 8% was noticed in January. The overall annual February figure of 321,59% was a decline of 41 points from 363% in January.
In the 2021 National Budget, the Ministry of Finance and Economic Development (MOFED) mentioned the need for 7.4% economic growth and the control of inflation to below 10% by end of December 2021. The decline in monthly food inflation therefore is inline with the 2021 budget stipulations in terms of inflation.
In the March 2021 CPI, ZIMSTAT said the month on month inflation rate in March 2021 was 2.26% shedding 1.19% points on the February 2021 rate of 3.45%.
“The CPI for the month ending March 2021 stood at 2.759.33 compared to 2.698.89 in February 2021 and 810.40 in March 2020,” reads the CPI.
In the Monetary Policy, the central bank said increased food production due to a favourable agriculture season are expected to subdue inflationary pressures.
Speaking to BusinessMail, economist Langton Mabhanga attributed the bumper harvest in this agricultural season to the fall of inflation in February and March 2021.
“Part of the decrease in inflation can be attributed to decrease in demand of commodities and a reduction of prices. Most of the agro based processed food are likely to go down as a result of the bumper harvest. The country now has more food due to the government driven agricultural programs,” he said.
According to Zimstat, the Total Consumption Poverty Line (TCPL) for one person stood at $5,312.00 in March 2021 ($5,187 in Feb). This means that an individual needed that much money to afford food and services in order not to be classified as poor.
The stability of the central bank’s auction system exchange rate can also be a strong drive to the reduction of inflation. Through this the monetary authority has managed to contain inflation.
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