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January inflation increases to 11,6 percent

Sikhulekelani Moyo, mskulekelani16@gmail.com

ZIMBABWE’S weighted month-on-month inflation rate increased by 10,5 percentage points this month to settle at 11,6 percent from 1,1 percent in December, figures from the Zimbabwe National Statistics Agency (ZimStat) show.

Inflation, usually measured monthly or yearly, represents the rate at which prices either go up or decrease over the measured period.

A decline in the rate, however, does not necessarily signify falling prices but the reduced pace at which prices are rising.

In an update issued yesterday, Zimstats said for the month of January 2025, the weighted consumer price index (CPI) for food and non-alcoholic beverages contributed mostly to the month-on-month change in index (inflation rate) by a magnitude of 4,7 percent, followed by housing, water, electricity, gas and other fuels with a magnitude of 3,9 percent.

“The weighted month-on-month inflation rate was 11,6 percent in January 2025, gaining 10,5 percentage points on the December 2024 rate of 1,1 percent,” said the statistics agency.

“The United States dollar (USD) month-on-month inflation rate was 11,5 percent in January 2025, gaining 10,9 percentage points on the December 2024 rate of 0,6 percent.

“The ZWG month-on-month inflation rate was 10,5 percent in January 2025, gaining 6,8 percentage points on the December 2024 rate of 3,7 percent.”

Zimstats said during the period under review, the month of January 2025, the ZWG CPI for housing, water, electricity, gas and other fuels contributed mostly to the month-on-month change in index (inflation rate) by a magnitude of 6,3 percent followed by food and non-alcoholic beverages with a magnitude of 2,4 percent.

The Treasury has said the 2025 National Budget is built on the foundation of single-digit inflation and a stable exchange rate, creating a favourable business environment.

It also said inflation, which is more than double the projected level, will lead to increased expenditure pressures without a corresponding rise in revenue, putting further strain on public finances.

Such volatility will drive interest rates higher, escalating borrowing costs and worsening fiscal deficits.
Commenting, economist and National University of Science and Technology (Nust) lecturer, Mr Stevenson Dlamini, said the rise in the inflation rate could have been caused by a decline in production and the effects of El Nino-induced drought last year.

“The observed inflation can be a result of reduced production due to the increased cost of doing business as well as depressed production from the agriculture sector,” said Mr Dlamini.

Meanwhile, Zimstat has said the Food Poverty Line (FPL) for one person in January 2025 was ZWG 861,14.

Food Poverty Line represents the amount of money that an individual requires to afford a daily minimum energy intake of 2 100 calories. The Total Consumption Poverty Line (TCPL) for one person was ZWG 1 255,78 in January 2025. —@SikhulekelaniM1

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