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Zimbabwe Inflation Eases On Technical Factor - But Still World's Highest

Zimbabwe’s consumer inflation retreated from a record high of 1,204% in August to some 1,023% in September, according to the Central Statistical Office. But the decline was mainly technical as a large surge in September 2005 dropped out of 12-month cumulative inflation. Inflation in Zimbabwe remained the highest in the world.

Statistical Office Acting Director Moffat Nyoni said the larges price increases came in paramedical services, motorcycles and home electricity rates.

He also said the so-called food poverty line for an average family of five persons had risen to Z$40,400 in September from Z$31,948 for August.

Elsewhere, the Reserve Bank of Zimbabwe raised its benchmark lending rate by 200 percentage points to 500%. One opposition economist, Mufandaedza Hove, said this hike in the overnight interbank cost of money was not enough to brake inflation.

Chief Economist Prosper Chitambara of the Labor and Economic Development Research Institute told reporter Blessing Zulu of VOA's Studio 7 for Zimbabwe that Harare's astronomical inflation rate is discouraging potential foreign investors.

More reports from VOA' s Studio 7 for Zimbabwe...