Zimbabwe continues on deflation slide

Harare – Zimbabwe continued on a fresh slide into deflation in December as prices fell due to tight liquidity, figures from the government statistics agency on Thursday showed.

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Inflation flat at -0.80pct, trend to persist throughout the year – ZimstatPrices decreased by an average of 0.80 percent between December last year and the same month in 2013.

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“The year on year inflation rate for the month of December 2014 as measured by the all items Consumer Price Index (CPI) stood at -0.80 percent, the Zimbabwe National Statistical Agency said in a statement.

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That is down marginally from -0.78 percent in November.

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Zimbabwe’s economy has been on a downturn for over a decade characterised by high inflation, unemployment and deteriorating living standards.

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It slid into deflation in February, staying negative for five months in succession as prices fell due to a cash crunch which saw fewer buyers for goods and services.

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Prices recovered marginally going in the positive from July only to fall back into deflation in November.

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Finance Minister Patrick Chinamasa has lowered the growth forecast for this year from 4.1 percent to 3.2 percent.

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The government, saddled with a huge debt, has been battling to pay its workers and resorted to staggering dates to pay bonuses. – AFP