Zimbabwe deflation gets worse to -1.28pct

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    HARARE,– Zimbabwe’s inflation slid to -1.28 percent in January from the December 2014 rate of -0.80 percent on an annualised basis, the national statistics agency said on Monday.

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    Zimbabwe inflation slides to -1.28pct – Zimstat

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    Month-on-month, the inflation rate shed 0.25 percentage points on the December rate of -0.09 percent to -0.34 percent, the Zimbabwe National Statistics Agency said.

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    Last week, central bank governor John Mangudya said the continued decline in the inflation rate was necessary step towards price correction.

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    “The Reserve Bank’s considered view is that the reduction in the rate of inflation in the national economy was and is a necessary process towards correcting the high prices obtaining in the country. It is disinflation and not deflation,” he said in the monetary policy statement.

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    “The disinflation in Zimbabwe is therefore a good development as it increases the consumers’ purchasing power. Disinflation is different from a deflation phenomenon which is caused by businesses lowering prices in a desperate attempt to get consumers to buy their products.”

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    He said inflation is expected to remain in the negative territory for the greater part of 2015, reflecting the effects of depressed international oil and food prices, weaker currencies against the United States dollar and the positive effect of disinflation in the economy. – The Source