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Zimbabwe's annual inflation slows to 3.6 percent

HARARE (AFP) – Zimbabwe's annual inflation eased to 3.6 percent for the month of October, down from the September rate of 4.2 percent, the government statistics agency said Tuesday.

"The year-on-year inflation rate for the month of October 2010 as measured by the all-items consumer price index (CPI) stood at 3.6 percent," the Zimbabwe National Statistics Agency (Zimstats) said in a statement.

Monthly inflation was 0.2 percent in October, up from 0.1 percent in September, Zimstats said.

The agency attributed the rise in monthly inflation to higher prices for food and non-alcoholic beverages.

The strengthening of the rand in neighbouring South Africa has pushed up prices in Zimbabwe, which still relies on imports from South Africa as local manufacturers battle to recover from the effects of a nearly decade-long economic crisis.

Zimstats said a family of five requires at least 462 dollars (339 euros) a month to buy food and non-food items.

Most government workers earn an average salary of 200 dollars a month, and unemployment remains high.

Zimbabwe's inflation has fallen dramatically in the last two years since the formation of a coalition government that off-loaded the inflation-ravaged local dollar in favour of the US dollar.

The last official estimate of inflation in Zimbabwe dollars in 2008 was 230 million percent, but independent experts said the real figure was in the billions.