April inflation up 0.48pc

THE year-on-year inflation rate continued on an upward trend in April, gaining 0,27 percentage points to close the month at 0,48 percent as the International Monetary Fund recommended a halt to excessive Government expenditure which it said could fuel inflation.

In March, the year-on-year inflation rate — the annual percentage change— stood at 0,21 percent, according to the Zimbabwe National Statistics Agency. This means that prices as measured by the all items Consumer Price Index increased by an average of 0,48 percentage points between April 2016 and April 2017.

An International Monetary Fund which was in the country from May 2 to 13, 2017, to hold discussions with the authorities, private sector representatives, and civil society in the context of the 2017 Article IV Consultations said excessive Government spending, if continued could fuel inflation. “The recovery in agriculture and mining will drive growth this year. However, maintaining the growth momentum will require action to expedite the authorities’ plans to reduce the deficit to a sustainable level.

“Excessive Government spending, if continued, could exacerbate the cash scarcity, further jeopardise the health of the external and financial sectors, and, ultimately, fuel inflation,” head of mission Ana Lucía Coronel said in a statement at the conclusion of the visit.

The discussions covered recent economic developments, the outlook and risks, as well as policies that could restore economic stability. The year-on-year Food and Non Alcoholic beverages inflation prone to transitory shocks stood at 1,35 percent while the Non-food inflation rate was 0,08 percent.

The CPI for the month ending April 2017 stood at 97,07 compared to 97,01 in March 2017 and 96,60 in April 2016.

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