Zimbabwe year on year inflation reaches 355.000%

YEAR on year inflation for the month of March surged to 355 000% from the February figure of 165 000% as prices rose on the back of increased money supply to finance the 2008 harmonised elections.

the CSO [Central Statistical Office] projection, sources said, has placed inflation for May at over 1 200 000% if the trend continues.

The figures come at a time the RBZ has introduced higher denomination bearer cheques notes to counter the adverse effects of inflation.

The central bank introduced the $500 million bearer cheques for the public and the $5 billion, $25 billion, $50 billion agro-cheques for farmers. The new notes come hardly two weeks after the introduction of the $250 million bearer cheques.

Here’s the link, via Greg Mankiw who also links to this report from the Reserve Bank of Zimbabwe. An excerpt:

1.24: Our economy is and has been in trouble for over ten years and our extraordinary interventions by whatever name have helped to keep the wheels of this economy moving. [my emphasis]

1.25: Even though our efforts have been criticized and derided clearly for undisguised political reasons, we are proud that we had the courage to do something that made a positive difference when it would have been far too easy for us to appear reasonable by doing nothing and thereby make the situation worse.

Make the situation worse? How could things possibly get worse than they are now? How could any other course of action not have improved matters relative to the way they are now? No – don’t answer those questions. The last thing Mugabe needs right now is new ideas on how to make the lives of his countrymen even more miserable than they already are.


May 17, 2008 - Posted by | Africa, Economics

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