Cost of living up
ZIMBABWE’S cost of living, as measured by the Consumer Council of Zimbabwe (CCZ), food basket for a low income family of six, rose to $14 438 in August from $14 256 in July, representing a 1,27 percent increase.
This comes as prices of basic goods and services in the country increased in August although annual inflation declined from 837,53 percent to 761,02 percent during the same period according to the Zimbabwe National Statistics Agency. (ZimStat)
“Major increases were recorded in milk, washing powder, tea leaves and salt. Food had the lion’s share contributing 75 percent followed by rentals at nine percent. In July 2020, the share of food was 74 percent, followed by rentals at 10 percent,” said CCZ.
Commenting on the food basket and latest inflation figures, the Confederation of Zimbabwe Industries (CZI) said: “The large proportion of income spent on food signifies a high marginal propensity to consume and high poverty levels for households. Insecurity levels are rising as households can hardly afford other items other than food let alone savings.”
Month-on-month inflation rate for August 2020 stood at 8,44 percent, shedding 27,09 percentage points on the July 2020 rate of 35,5 percent.
Owing to the fact that there is dual pricing in the economy, ZimStat is now publishing a blended inflation rate which combines RTGS$ and US dollar prices.
The blended month on month inflation rate for August 2020 was 1,41 percent shedding 15,24 percentage points on the July 2020 rate of 16,65 percent.
“Zimbabwe’s annual inflation rate decreased from 837,53 percent in July 2020 to 761,02 percent in August 2020. This signifies a reduction in the rate of price increases in the economy,” said CZI.
CZI said the economy was experiencing a wave of rising insecurity levels as evidenced by ZimStat data.
ZimStat reported that the Food Poverty Line and the Total Consumption Poverty Line increased to $7 211 and $17 224 in August 2020 compared to $6 643 and $15 573 respectively for July 2020, for an average household of five.
“Given the constant level of incomes, these developments have a negative impact on standards of living over and above reducing demand for goods and services produced by the productive sector,” said CZI.
According to the CZI price tracker, the monthly price change from mid-August to mid-September 2020 was 2,7 percent.
“It is important to note that some commodities recorded declines in prices and these include Mazoe, green bar, rice and flour. Transport services recorded the highest increase in price during the period under review,” said CZI.