Tight monetary policy stabilised economy: Economic Analysts

Staff Reporter

Economic analysts have commended President Emmerson Mnangagwa and his Cabinet for implementing successful financial policies that have seen the country’s economy stabilising from the first half of the year after the Covid19 pandemic.

Commenting after President Mnangagwa’s State of the Nation Address (SONA) yesterday, Economic Analyst Abednigo Matsika concurred with the President that tight economic policies are bearing fruit as they have managed to keep the value of the country’s currency.

“The value for money in the procurement process became the best thing that the Government did in its efforts to ensure that there is no excess money going into the economy that can be used to fuel inflation on the exchange rate.

“This has managed to restrain forward pricing and balance the exchange rates, resulting in the convergence of both parallel and official rates,” Matsika said.

In his SONA, President Mnangagwa said, “Tight monetary and fiscal policy measures to stabilise the economy, and curtail borrowing and other rent-seeking behaviour, are bearing fruit.”

“Month-on-month inflation for September significantly declined to 3.5% from 12.4% in August, 2022.  Every Zimbabwean must jealously guard this stability,” the President said.

Meanwhile, the International Monetary Fund (IMF) has also commended the country’s monetary policy interventions, saying they are in the right direction and have helped to stop the currency’s free fall.

“The recent tightening of monetary policy and the constrained budget deficits are policies in the right direction and have contributed to the narrowing of the parallel market exchange rate gape,” the fund said.