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Zimbabwe: Analysts Cautious About Inflation Rate Decline

WARNING: This is Version 1 of my old archive, so Photos will NOT work and many links will NOT work. But you can find articles by searching on the Titles. There is a lot of information in this archive. Use the SEARCH BAR at the top right. Prior to December 2012; I was a pro-Christian type of Conservative. I was unaware of the mass of Jewish lies in history, especially the lies regarding WW2 and Hitler. So in here you will find pro-Jewish and pro-Israel material. I was definitely WRONG about the Boeremag and Janusz Walus. They were for real.

Original Post Date: 2004-01-22  Posted By: Jan

From the News Archives of: WWW.AfricanCrisis.Org
Date & Time Posted: 1/22/2004 5:13:59 AM
Zimbabwe: Analysts Cautious About Inflation Rate Decline

[Note. It appears that the Zim govt are doing what they are best at – telling lies. In this case, about the “declining inflation”. Jan]

Zimbabwe’s annual inflation rate, one of the highest in the world, dropped by 21 percent in December but analysts regard this as a “temporary reprieve” and not a sign that the economy is on the mend.

The government-run Central Statistical Office (CSO) on Tuesday released figures indicating inflation had dropped to 598.7 percent in December from 619.5 percent in November.

Economist John Robertson explained to IRIN: “It does not mean that the prices are not increasing – they continue to rise. The new figures indicate that while prices of commodities had gone up by 33.6 percent in November, the increase was reduced to 11.2 percent in December.”

He noted that while the drop in the inflation rate might “seem as the step in the right direction, our inflation rate at 598.7 percent is much too high.”

There were several factors – not related to any of the government’s initiatives – responsible for the drop in prices during December, he said. One of these was the rise in the Reserve Bank’s interest rates, which had forced shopkeepers to lower prices so they could clear their bank overdrafts from increased cash flow generated by sales.

“Shopkeepers had been sitting with goods which had not moved in months,” said Robertson. Parents of school-going children, confronted with an 84.3 percent hike in school fees between October and December 2003, had also put off buying goods which were not essential.

Robertson pointed out that there had been a drastic increase in the price of commodities from August/September to November. According to CSO’s Consumer Price Index, a foodstuff priced at US $14.75 in August 2003, sold at US $30.20 in November. A medical service costing US $7.55 in August had shot up to US $23.15 in November.

While the price of bread and cereals recorded a decrease of 1.7 percent from October to December 2003, dairy products, including milk, cheese and eggs, were 28 percent more expensive at the end of 2003.

The official Herald newspaper claimed on Tuesday that the decline in the inflation rate was a result of the central bank’s measures to control speculation and fraud in the financial sector.

But Robertson pointed out that the measures, such as the introduction of foreign exchange auctions, had only happened in January, so “it could not have possibly influenced the inflation rate in December.”

The auction system has served to force down the value of major foreign currencies on the parallel market. The US dollar traded at approximately Zim $6,000 a month ago on the parallel market, but was now down to Zim $4,500, a loss of 25 percent in value.

Source: AllAfrica.com
URL: http://allafrica.com/stories/200401210479.htm…br>