HARARE – Monetary authorities say Zimbabwe’s annual inflation, which currently stands at 257%, will continue to rise until September this year, before slowing from October in response to central bank interventions.
The Reserve Bank of Zimbabwe (RBZ) said on Monday that its monetary policy committee left interest rates in place since June unchanged at the controversial 200% level when it met late last month.
“After monthly inflation fell from 30.7% in June 2022 to 25.6% in July 2022, the MPC (Monetary Policy Committee) noted that the gradual decline over the forecast period was due to the bank’s tight monetary policy,” Central Bank Governor John Mangudya said in a statement.
“The MPC further noted that monthly inflation is expected to continue to decelerate over the forecast period, but annual inflation is expected to continue to increase in 2021 through September 2022 due to the lower base effect,” he said.
Considering the above developments and outlook, Mangudya noted that the MPC decided to leave interest rates at current levels.
The RBZ chief said that the MPC also noted that the disinflationary trend is reinforced by the measures the government is taking to address destabilizing factors in the foreign exchange market, including revising the basis and framework for payments to its suppliers of goods and services in their quest to stabilize the foreign exchange market and improve value for money.
Presenting the mid-term review and 2022 supplementary budget to parliament on Thursday, Finance Minister Mthuli Ncube blamed external pressure for the rise in inflation.
- Editor / additional information by NewsDay Zimbabwe