Zimbabwe’s inflation is less than half what the government says and is already below the 55% that the central bank has predicted for July according to United States economist Steve Hanke.
Hanke put Zimbabwe’s inflation at 46.16% as of yesterday. The official inflation for June was 106.6%.
The Reserve Bank of Zimbabwe says it expects inflation to decline to 55% this month and to below 25% by December.
To sustain the current inflation trajectory and support the envisaged robust economic growth for 2021 and beyond, the RBZ’s monetary policy committee, which met on Monday, has made the following resolutions:
- Maintaining the Bank policy rate at 40% and the interest rate on the Medium Term Accommodation Facility at 30% per annum;
- Further tightening monetary policy by reducing the reserve money growth target from 22.5% per quarter to 20% per quarter going forward, while continuing to review the reserve money growth target to achieve and maintain stability of inflation and the exchange rate in line with developments in other macroeconomic fundamentals; and
- Streamlining the Foreign Currency Auction System to reflect macroeconomic fundamentals and ensuring that the country’s productive sector is given priority in terms of allotment.
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