RBZ targets to keep year-end inflation below 5%, tight monetary policy to remain

Senior Business Writer

THE Reserve Bank of Zimbabwe’s Monetary Policy Committee (MPC) expects year-end inflation to stay below five percent due to a stable exchange rate as it plans to continue the strict monetary policy stance to maintain the existing stability.

Following its meeting on Wednesday, the MPC expressed contentment with the favorable outcomes of the monetary policy measures that have stabilised both the exchange rate and domestic prices.

The committee acknowledged the effectiveness of the stabilisation measures implemented by the Central Bank from the start of April 2024, leading to a May 2024 month-on-month ZiG inflation rate of  minus 2.4 percent

“The inflation rate is expected to be around  zero percent in June 2024 due to declines in both food and non-food inflation,” it said.

“Inflation pressures will remain subdued in the outlook period with projected inflation to end the year below five percent as the exchange rate remains stable.”

The committee said despite the effects of the El Nino induced drought, the economy has remained resilient and is expected to grow at around two percent in 2024.