Zimbabwe's Inflation Increases To 3.5%

“Prices as measured by the all-items Consumer Price Index increased by an average 3.5 percent between March 2009 and March 2010,” the CSO said in a statement.

“The year-on-year food and non-alcoholic beverages inflation prone to transitory shocks stood at 1.23 percent in March while non-food inflation stood at 4.55 percent,” the CSO said.

On Thursday, finance minister Tendai Biti accused local businesses of stoking inflation, saying speculative price increases were creating inflationary pressure.

“On analysis, the increase in the inflation figures have largely been food-driven,” he said.

“The inescapable conclusion in the absence of key fundamental inflation drivers that are justifiable is speculation,” he said.

Aid agencies say an estimated two million Zimbabweans are in need of food aid after a crisis that saw record-setting hyperinflation wreak havoc on the country’s economy.

In January last year, the government decided to abandon the essentially worthless local currency, allowing trade in US dollars or other foreign currencies.

That quickly stabilised the economy, ending a freefall that had spanned nearly a decade and allowing some businesses to begin piecing together their shattered operations.

But the use of multiple currencies has brought erratic pricing practices as businesses set their own exchange rates between US dollars, South African rands and other currencies.