Year on Year inflation moves to 66 percent

By Davison Vandira

ECONOMISTS have called on monetary authorities to strictly adhere to a tight monetary policy stance to curb inflationary pressures in the economy.

The call is a reaction to consumer price index statistics released by Zimstat this Thursday, where month on month inflation has moved from 5% to 7% while the year on year inflation has surged from 60.6 percent in January to 66.1 percent this month.

Economic observers have singled out excessive reserve money growth as the major cause of inflation while adverse inflation expectations by economic agents are also playing a pivotal role in the slippery movement in prices to the detriment of the economy.

Economists believe the pass-through effects of exchange rate instability are perpetuating the undesirable increase in inflation, hence the urgent need to strictly pursue the announced tight monetary policy stance.

“The current increase in inflation level should be dealt with as a matter of urgency to curtail the excessive reserve money growth,” said Kipson Gundani, an Economist.

“The obtaining situation concerning inflation movement is worrisome and needs corrective measures for the country to be able to meet its economic objectives,” said Batanai Matsika an economic analyst.

Zimbabwe’s Fiscal and Monetary authorities have put an end of year inflation forecast at 20 percent with the country expected to move towards single-digit figures in the vision 2030 economic journey.