According to the latest figures published by ZIMSTAT the month on month inflation rate for August fell to 18.07% down by 2.97% from the July inflation figure of 21.04%.
What does it all mean?
It means that the prices of goods rose by 18% in August compared to their prices in July. The important fact is that even though the rate at which prices were rising had slowed down in August compared to July, the fact is that prices were still rising. In fact in monetary terms, it is very probable that goods rose by more in August than in July.
So for example, if an item cost $10 ZWL in June, its price would have been $12.10 in July (an increase of $2.10) compared to $14.29 in August (an increase of $2.19). As you can see the increase in absolute dollar terms is bound to be higher in August compared to July.
It’s all in the past! Expect inflation to go up again
We and our colleagues at MarketWatch have observed a sharp decline in the value of the Zimbabwean dollar over the past few weeks. The prices of basic commodities which are often based on US dollar black market rates have also risen sharply in September as retailers try to keep up with the rate and avoid loses.
This rate is very much historical. It looks at what happened in August versus what happened in July. Both months are very much in our view mirror as we are well into September. The rate at which prices are rising has sadly picked up.
Sadly wages haven’t been keeping up with inflation resulting in people being priced out of buying even the most basic materials including mealie-meal and bread.