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Zimbabwe Inflation Nears 1,100%, Fueled By Health, Transport

Consumer inflation in Zimbabwe climbed in November by 28.6 percentage points to 1,099% for 12 months from 1,070% in October. Though it did not reach the all-time high of 1,185% set in June, Zimbabwe's inflation remained the world's highest.

The country's Central Statistical Office said the biggest year-on-year increases were in medical services and electricity, while the biggest culprits on a month-over-month basis were tobacco, transport and education fees.

Finance Minister Herbert Murerwa recently predicted in his 2007 budget statement that inflation would slow to between 300% and 400% next year. But most economists expressed considerable skepticism at this forecast as they did at his projection of GDP growth between 0.5% and 1% in 2007 based on mining and agriculture.

Economist Mufandaedza Hove, secretary for economic affairs with the Movement for Democratic Change faction of Morgan Tsvangirai and a business and accounting lecturer at the University of Zimbabwe, said central bank funding of government operations obliging the creation of new money is still fueling inflation.

Economist John Robertson of Harare told reporter Blessing Zulu of VOA’s Studio 7 for Zimbabwe that the true inflation rate might be even higher than the official figure.

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