CZI commends double-digit inflation trends

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By Alois Vinga

CONFEDERATION of Zimbabwe Industries (CZI) has commended authorities for sustaining inflation rates within the double-digit margins up to the end of 2023.

The Business Member Organisation (BMO) 2023 Inflation and Currency Report concludes that generally, the 2023 annual inflation trend was falling largely attributed to the change in the methodology of calculating inflation.

Despite the change in methodology, the annual blended inflation rate for December 2023 gained 4,9% to settle at 26,5% from 21,6% in November 2023.

The organ however says comparing with the same period in 2022 using the new methodology, December 2023 annual inflation declined by 29,4% from 55,9% in December 2022 showing an improvement in inflation management in 2023 compared to 2022.

“This is also confirmed by the average annual inflation, which was 29.8% for 2023, which is about 12.9 percentage points less than an average annual inflation of 43% for 2022. The improvement in 2023 can be attributed to the measures to fight inflation and ensure exchange rate stability introduced in May 2023.

“The government, thus, managed to maintain blended annual inflation within double digits, which was in line with the 2023 National Budget Statement target,” said CZI.

The business lobby group also observed that the average month-on-month inflation for 2023 was 2.0% which is 1.8% less than the 2022 average month-on-month inflation of 3.8% which it said also emphasizes that inflation management was generally improved in 2023 compared to 2022.

“Given that the measures affect the USD pricing as well, the inflationary pressures that will take effect from January 2024 are expected to remain throughout the year, as the base consumer price indices for 2023 are relatively lower. Thus, it is not likely that the inflation targets for 2024 of between 1-3% will be achievable,” added the CZI.