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The Zimbabwe National Statistics Agency (ZimStat) says the shortage of foreign currency has led to high premiums being charged to access the money, which is being passed onto the consumers, pushing inflation upwards.
BY TATIRA ZWINOIRA
In a report released on Wednesday, ZimStat said: “The shortage of foreign currency has led to high premiums being charged to access foreign currency. These premiums are being passed on to the consumer resulting in inflation, which we are currently experiencing. The trend is expected to continue during the year.”
It said the month-on-month inflation between December 2016 and January 2017 grew by 0,18 percentage points.
“The major factor behind the upwards trend in inflation is the shortage of foreign currency to import critical raw materials, ” ZimStat said.
ZimStat reported that delays in foreign currency payments to import critical raw materials were now driving inflation upwards, as year on year inflation increased by 0,28 percentage to -0,65% in January from -0,93% in December 206.
Analysts say putting a premium on foreign currency could result in price increases and move the economy from a deflationary mode to an inflationary one.
The 2017 Economic Outlook report by the ministry of Macro-Economic Planning and Investment Promotion stated that the shortage in foreign currency was hampering funds for critical inputs in most sectors of the economy.
Locally, premiums are also on the rise as individuals and manufacturers are seeking to repatriate foreign currency to their suppliers or lenders at a faster rate.