Inflation puts basic foods out of reach

Zimbabwe's Consumer Council (ZCC) on Thursday said the latest jump in inflation would put the price of basic commodities further beyond the reach of the urban poor. The Central Statistical Office pegged the inflation rate for June at 364.5 percent, more than 64 percent up from the previous month's high of 300 percent. "Price increases continue to push the cost of living for the urban poor well above their income levels," CCZ director Elizabeth Nerwande told IRIN. The CCZ estimates that an urban household of six members would now need over Zim $200,000 (about US $241) per month to cover its basic needs. On average a domestic helper in Zimbabwe earns Zim $25,000 (about US $30) per month, while a court orderly's salary is Zim $60,000. "In high-density suburbs across Harare (the capital) we are seeing people facing real poverty. Most people have exhausted their coping mechanisms and are living from hand to mouth. And the situation is unlikely to improve, given the broader economic crisis in the country," Nerwande said. A government decision in May to suspend price controls on some commodities had "slightly" improved the situation. "Some basic foodstuffs have re-appeared on shelves in supermarkets, but these are often sold at parallel market prices and are unaffordable for most households," Nerwande said. Earlier this week bakers unilaterally hiked the price of bread from Zim $550 (US 60 cents) to Zim $1,000 (US $1.14 ) a loaf, following an increase of more than 1,000 percent in the Grain Marketing Board's (GMB) selling price of wheat. In response to the price hike consumers boycotted bread, forcing retailers to reduce the price to Zim $800 (about US 90 cents.) Nerwande also raised concerns that the current inflation rate did not reflect reality, because it ignored the thriving parallel market where prices were almost double controlled rates.