shloboe boe
Sikhulekelani Moyo, mskhulekelani16@gmail.com
AS Zimbabwe continues to record a decline in inflation, economists have called on the Government to implement robust policies that promote massive production of local goods and services to sustain the positive trend and prevent a resurgence in 2025.
According to the Zimbabwe National Statistics Agency (ZimStat), the weighted month-on-month inflation rate for December 2024 was 1,1 percent, down from 2,2 percent in November 2024, marking a decrease of 1,1 percentage points.
Meanwhile, the US dollar month-on-month inflation rate rose slightly to 0,6 percent in December, up from 0,1 percent in November. The Zimbabwe Gold (ZWG) month-on-month inflation rate saw a significant drop, falling to 3,7 percent in December from 11,7 percent in November, an eight percentage-point decline.
Economists have largely attributed the reduction in inflation to the Reserve Bank of Zimbabwe’s (RBZ) tight and conservative liquidity policies
Responding to questions from Business Chronicle, economist Mr George Nhepera, emphasised the importance of aligning monetary and fiscal policies to maintain exchange rate and price stability, which he described as essential for economic growth and building business confidence. “To contain inflation and prevent its resurgence in 2025, the Government must focus on policies that promote massive production of goods and services across all sectors,” he said.
Mr Nhepera commended the central bank for its success in managing inflation through a stringent liquidity policy and said this approach be maintained.
“The central bank appears to be “winning” the fight against inflation and this tight liquidity policy should remain a priority going forward. This is quite commendable and should remain a policy of choice going into the future.”
Mr Nhepera also advocated for deregulation in industries to enhance business confidence and economic activity. “From an economic standpoint, reducing excessive Government regulations can boost business confidence, increase economic activities and enable the Government to collect more taxes to fund its programmes,” he said.
ZimStat also released data on the food poverty line (FPL) and total consumption poverty line (TCPL) for December 2024.
The FPL for one person was pegged at ZWG805,95, representing the minimum amount required to afford daily energy needs of 2 100 calories.
The TCPL, which includes both food and non-food items, stood at ZWG1 156,67 per person. These figures underline the ongoing economic challenges faced by many Zimbabweans.
The introduction of Zimbabwe Gold (ZWG) in April 2024 has played a significant role in stabilising prices for goods and services. As part of measures to address exchange rate volatility and curtail inflation, the RBZ unveiled ZWG as a medium of exchange to restore macro-economic stability. — @SikhulekelaniM1
Siphakeme .Mnindwa
