Skip to main content

Zimbabwe Inflation rate zooms - Hyperinfation


Zimbabwe’s country’s annual inflation rate is 231000000%, according to official statistics.Hyperinflation. A loaf of bread cost Z$200,000 in February. Today it costs Z$,600,000,000,000.The mind boggles.

Zimbabwe was once a major food supplier to Africa but the economy has come apart since attempted reforms destroyed the agriculture industry.Zimbabwe has introduced a $250 million note recently as the country tries to ease the effects of hyperinflation.

The main cause of such hyperinflation is a massive and rapid increase in the amount of money (estimated at 17,000%), which is not supported by growth in the output of goods and services.This results in an imbalance between the supply and demand for the money (including currency and bank deposits),accompanied by a complete loss of confidence in the money, similar to a bank run.

The inflation is also exacerbated by a shortage of supply. Because basic goods are in short supply it is easy for market prices to be increased causing a spiral effect of upwardly rising prices.

Popular posts from this blog

NSE Trading Holidays 2024

 Trading holidays for the calendar year 2024. The National Stock Exchange of India (NSE) has notified trading holidays for the calendar year 2024 as below: Muhurat Trading:  Timings of Muhurat Trading shall be notified subsequently. 

Historical BSE Sensex returns - updated 2013

We have already seen the historical returns of the BSE Sensex, which indicated an average return of about 20%  per year, despite many yearly returns varying from -20% to +60%. The following table shows BSE Sensex historical data - open, close and the yearly returns of the sensex from 2000 to 2012. There are some interesting points to note from the above table. Post 2008 crash of about 50% and 2011 negative returns of 24%, markets have given positive returns of 81% and 25%. Also the average returns for the past years is about 20% despite the markets being down 24%. The lesson is pretty much clear - long term investing pays and one need not bother too much about the ups and downs of the markets. During the past few years, the returns from investing in individual stocks have been varied.  Despite markets being at 2 year highs, only a few stocks are at similar highs, while most of them are still languishing well below their historical highs and are down anywhere between 8