Emmanuel Kafe and Sharon Masocha
Prices of basic goods are projected to remain largely stable going into this year’s festive season, owing to the economic stabilisation measures rolled out by authorities in recent months.
The Reserve Bank of Zimbabwe (RBZ) recently rolled out monetary interventions aimed at curbing foreign exchange pressures that had affected stability of the Zimbabwe Gold (ZiG) currency.
As a result, the foreign currency exchange rate on the parallel market has remained largely stable at around US$1: ZiG35, while the official market rate stands at US$1: ZiG27.7.
A price monitoring survey conducted by this publication over the past three weeks shows that prices of key commodities, such as maize meal, cooking oil, and bread, have remained steady — a trend that is expected to extend into the holiday period.
A standard loaf of bread is retailing at around ZiG28,50 (about US$1,15), while the cost of a 20kg bag of mealie meal averaged ZiG250 (around US$10).
A 2kg pack of rice was selling for around ZiG80, while a 2kg bag of washing powder was retailing for around ZiG235.
In an interview with The Sunday Mail, Consumer Protection Commission research and public affairs manager Mr Kudakwashe Mudereri said exchange rate stability has played a critical role in keeping prices under control.
“The commission has, however, noted that there is now some modicum of stability as the exchange rate has remained stable at close to ZiG28:US$1 on the official market, with some slight movements on the parallel market,” he said.
“Resultantly, prices have remained relatively stable over the ensuing period.”
He said if the Government maintains its current policies, price stability will continue through year-end.
“This will go a long way in taming inflation pressures and impact positively on consumers,” he added.
Mr Mudereri said the CPC will continue to closely monitor market trends and engage stakeholders to ensure price stability.
Economist and member of the RBZ Monitoring Policy Committee (MPC) Mr Persistence Gwanyanya said there was apparent stability in the market, which can be sustained throughout the festive season.
“As the liquidity conditions are tightened, we have seen a slowdown in the parallel market activities,” said Mr Gwanyanya.
“This modicum of stability gives us confidence that by year-end the targets that the central bank has set, that is of 5 percent of month-on-month inflation will be achievable.
“We are confident prices will remain relatively stable throughout the festive period.
“The interbank market has also been picking up with business securing forex from the interbank market.”
He said tightening of liquidity has helped ensure prices remain stable.
Added Mr Gwanyanya: “We are confident that despite the projected increases in inflation for October on account of currency depreciation, the inflation target will be achievable.”
