Zimbabwe National Statistics Agency (ZIMSTAT) has reported that Zimbabwe’s annual inflation for July dropped to less than 60 per cent from more than a hundred the previous month.
Data from ZIMSTAT shows that for the first time since July last year, annual inflation has dropped to double-digit figures.
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The agency notes that the trend means prices increased by 56.37 per cent between July last year and the same month this year.
ZIMSTAT has also cited the foreign currency auction system which has stabilised the local dollar against major currencies as the main element in the reduction of annual inflation, a development that has been well received by consumers.
Treasury and the central bank have also hinted on restoring increased purchasing power for consumers through tight inflation control measures.
Zimstat reveals inflation which refers to the rate at which prices are increasing over a given period of time has dropped to 56 per cent this month from 837 per cent in July last year. Said the agency in a statement:
Consumer Price Index— July 2021
The month on month inflation rate in July 2021 was 2.56 percent shedding 1.32 percentage pints on the June 2021 rate of 3.88 percent.
The year on year inflation rate (annual percentage change) for the month of July 2021 as measured by the all items Consumer Price Index CPI stood at 56.37 percent.
The #1CPI for the month ending July 2021 stood at 3,062.93 compared to 2, 986.44 in June 2021 and 1,958.72 in July 2020.
Blended Consumer Price Index— July 2021
The month on month inflation rate in July 2021 was 0.67 percent shedding 3.82 percentage points on the June 2021 rate of 4.49 percent.
The year on year inflation rate (annual percentage change) for the month of July 2021 as measured by the all items blended Consumer Price Index #BCPI stood at 21.61 percent.
The blended CPI for the month ending July 2021 stood at 121.61 compared to 120.80 in June 2021 and 100.00 in July 2020.
POVERTY DATUM LINES – JULY 2021
• The Food Poverty Line (FPL) for one person in July 2021 was $4,379.00.
• The Total Consumption Poverty Line (TCPL) for one person stood at $6,126.00 in July 2021.
Concepts and Definitions of the Lower Bound Poverty Line
With effect from November 2020, ZIMSTAT is now producing the Poverty Datum Lines (PDL) using the lower bound poverty line. The method refers to the sum of food poverty line and the average amount derived from non-food items of households whose total expenditure is equal to the food poverty line.
The food poverty line (FPL) represents the amount of money that an individual will require to afford the minimum required daily energy intake of 2 100 calories.
The total consumption poverty line (TCPL) which is naturally higher than the FPL was derived using 2017 PICES data and using the lower bound poverty line method. It was derived by computing the non-food consumption expenditures of poor households whose consumption expenditures were just equal to the FPL. The amount was added to the FPL, if an individual does not consume more than the TCPL, he or she is deemed poor. For more details, the user is referred to a more recent publication by ZIMSTAT, Zimbabwe Poverty Update 2017-19.
The food poverty line (FPL) as at July 2021 stood at $4,379.11. This means that the minimum needs basket cost that much per person in June 2021. This represents an increase of 2.5 percent over the June 2021 figure of $4,271.85.
The Total Consumption Poverty Line (TCPL) for Zimbabwe stood at $6,126.41 per person in July 2021. This means that an individual required that much to purchase both non-food and food items as at July 2021 in order not to be deemed poor. This represents an increase of 2.5 percent when compared to the June 2021 figure of $5,974.89.
The poverty datum lines vary by province as prices vary from place to place. The differences are explained by differences in average prices in the provinces.
The quantities of commodities consumed at base year in the minimum needs basket which is consistent with the preferences of the poor individuals and households in Zimbabwe are fixed. The variations in the value of the basket are explained by changes in average prices.
• The TCPL of $6,126.00 represents the total income needed for an individual (with all their income added together) as a minimum for them not to be deemed poor.
• ZIMSTAT produces the official Poverty Datum Lines which are not comparable to cost of living indicators produced by other players in the market.