Zimbabwe’s annual inflation rate rose 1.38 percent to 4.29 percent in July 2018, latest figures from the Zimbabwe National Statistics Agency (ZImStats) show.
This was a significant upturn from the June 2018 figure of 2.91 percent.
On a monthly basis, the inflation rose 1.03 percentage points to 0.98 percent.
“The month-on-month inflation rate in July 2018 was 0,98 percent gaining 1,03 percentage points on the June 2018 rate of -0,05 percent,” said ZimStats in its monthly update.
Some observers have attributed the quickening inflation to the continuance of the parallel currency market.
Although the Reserve Bank of Zimbabwe (RBZ) has maintained the US dollar-bond note official rate at 1:1, cash shortages have resulted in a thriving black market for physical currency, both bond notes and United States dollar notes.
It is largely expected that the high demand for US dollars by both companies and individuals continues to push up the exchange rate.
THE Reserve Bank of Zimbabwe (RBZ) claims bond notes are now being sold in Botswana, bringing to four the number of Sadc countries where bond notes are reportedly on sale.
Initially, the central bank had claimed bond notes were being sold in Mozambique, Zambia and South Africa. At the recently-ended three-day Zimbabwe National Chamber of Commerce (ZNCC) annual congress in Victoria Falls last week, RBZ official, Azvinandawa Saburi told guests the central bank would work with the Zimbabwe Revenue Authority (Zimra) to try and stop the sale of bond notes across the border.
"Now, on the issue of bond notes being in Botswana, Zambia, Mozambique and so on, I think, as the RBZ, we are monetary authorities, who have to work with other bodies who have responsibility [at borders]," he said.
"So we will certainly talk to them and advise them on how probably they can handle this issue. On this, I would also want to add this is about the currency, the United States dollar is the most widely used currency. "So everyone in the world, everyone who is exporting and so on, is looking for those United States dollars, which is why people play all these shenanigans.
"But, the bottom line is that we are going to work with the Zimra to say that when people are going out they should not take bond notes."
So far, RBZ claims, the sale of bond notes is in neighbouring countries' border towns. The sale of bond notes was first confirmed in May in Manga, a town just outside Beira in Mozambique, which is close to the Mutare border.
Last month, Livingstone in Zambia and Park Station in Johannesburg, South Africa were also confirmed as points of sale of bond notes. "Another critical issue arising from this lack of confidence is externalisation of both the United States dollar and bond notes," ZNCC Manicaland vice-president, Kenneth Saruchera said.
"You would be surprised that bond notes are being externalised. In Mutare, if you just get across the border at that trading area in Manga, you will find heaps of bond notes. "Bond notes are very popular with the Mozambicans because they want to use this to shop in Zimbabwe so both the United States dollar and the bond notes are being externalised."
RBZ says there are $160 million worth of bond notes in circulation, with the Afreximbank facility of $200 million backing the surrogate currency expected to be extended. When they were introduced, the central bank governor John Mangudya said bond notes would not be externalised.
Credit: Newsday Zimbabwe