ZIMBABWE’S annual inflation for the month of July 2016, as measured by the all Items Consumer Price Index , shed 0,24 percentage points to -1,60 percent from June’s -1,37 percent, the Zimbabwe National Statistics Agency (Zimstats) reported yesterday.
This means prices as measured by the all items CPI fell by an average -1,60 percent between July last year and July 2016.
Month-on-month, the inflation rate in July worsened by 0,38 percentage points to negative 0,19 percent from June rate of 0,19 percent as the economy continues in a deflationary mode with companies earnings softening on lower aggregate demand.
“This means that prices as measured by the all items CPI decreased at an average rate of -0,19 percent from June 2016 to July 2016,” said Zimstats.
The year on year food and non alcoholic beverages inflation was -3,76 percent while non food inflation rate stood at -0,59 percent.
Statistics show that inflation rate for the food and non alcoholic beverages on a month on month basis shed 0,17 percentage points in July 2016, from June rate of -0,35 percent.
The month-on-month non-food and alcohol beverages inflation rate was -0,03 percent, shedding 0,48 percent on the June rate of 0,44 percent. The domestic economy has been wading through deflation due to the prevailing difficult economic challenges characterised by liquidity constraints, low consumer spending, strained fiscal space and low capacity utilisation in industry, which has forced many companies to downsize operations.
Government, however, recently introduced Statutory Instrument 64 of 2016 which prohibits importation of certain products that can be manufactured locally to allow local companies time and space to recapitalise, retool and acquire modern technologies.
The support measure is expected to promote local production, local consumption as well as enhance economic activity through various value chains involved in the manufacture of certain products.