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Harare - Zimbabwe’s inflation made a surprise U-turn in
June, giving respite to the Reserve Bank of Zimbabwe (RBZ) whose currency
initiatives have been blamed for the
upward trend in inflation in recent months.
The RBZ's introduction of bond notes, in an effort to
address cash challenges, has resulted in a three-tier pricing system, seen by
many as inflationary.
The inflation rate for June slowed down to
0.31% from 0.75% in May, after recording a 0.27 percentage point gain on the April 2017 rate of 0.48%.
Inflation on actual rentals and clothing weighed on overall inflation, with rental inflation coming out at -7.95% while clothing inflation was -1.15%. Property rentals have been under pressure in Zimbabwe, with tenants negotiating existing contracts or downward rental reviews.
Second-hand clothing causes problems
Importation of second-hand clothing is also putting pressure
on prices, resulting in the negative inflation on clothing. Last month clothing
retailer Edgars Stores said the importation of second-hand clothes has
compounded the woes of the local textile industry and squeezes retailers' margins.
The group's managing director Linda Masterson said there is a need for government to control importation of cheap used clothing into
the country, as this is affecting formal businesses that pay tax.
Food inflation, which has a huge weight on
inflation, has however been on a steady rise.
“The year-on-year food and non-alcoholic beverages inflation
prone to transitory shocks stood at 1.82%”, Zimstats said.
The upward pressure on inflation was dominated by food items
such as bread and cereals (2.56%), meat (1.89%), fish and seafood (3.89%),
milk, cheese and eggs (1.6%%) and sewage collection (5.2%), among others.
The month-on-month inflation rate also declined to sub-zero (-0.24%), shedding 0.27%
