Prices of basic commodities and household goods continue to gallop while consumers have lost their buying power and retail shops are beginning to feel the pinch as sales volumes drop.
According to the Confederation of Zimbabwe Retailers (CZR), prices have gone up by at least 25 to 75 percent on all retail products while prices of household electrical goods have gone up by 200 percent in recent weeks.
The hikes have been attributed to the disparity between the local RTGS dollar and the U.S. dollar and are pushing up inflation which stood at 59.39 percent at the end of March.
Although the interbank foreign exchange rate started at 1 U.S. dollar to 2.5 RTGS dollars when the Reserve Bank of Zimbabwe (RBZ) floated the local currency recently, the rate has spiralled as it is now at about 3 RTGS to the U.S. dollar, while the black market is charging a premium of 1 U.S. dollar to between 3.5 to 4.5 RTGS dollars.
Some manufacturers and retailers who source their foreign currency largely from the black market have increased their prices as a result.
"The shopping list is getting smaller. People are getting more desperate by the day as prices continue to rise while employers are either unable or unwilling to raise salaries," said a shopper at Westgate Shopping Center.
"My salary is now over-stretched because retailers continue to increase prices. I will not advocate for price control, but this madness has to be stopped somehow," he added.
CZR president Denford Mutashu confirmed to The Herald newspaper that consumer spending has declined considerably in recent months.
He attributed the situation to the mismatch between prices of commodities and consumers' low disposable incomes.
"There is a mismatch between prices and the rate at which incomes have been eroded. It is a serious cause for concern because there has been a notable decline in demand of goods.
"Over the past few weeks prices have gone up by at least 25-75 percent on all retail products while prices of household electrical goods have gone up by 200 percent.
"Consumers are opting for substitutes as much as possible and unfortunately some of the substitutes are being smuggled into the country. We need to continue to explore robust import substitution programs which are hinged on a vibrant export program," said Mutashu.
Mutashu said his organization was consulting with various stakeholders in the country to try and make sure that the parties reach a consensus on their pricing matrix.
"We are engaging the Confederation of Zimbabwe Industries (CZI), Zimbabwe National Chamber of Commerce and the Grain Millers Association of Zimbabwe to agree on the price structures and get to a point where consumers are not ripped off," he said.
CZI president Sifelani Jabangwe said producers had increased prices on the back of rising costs, for instance prices paid to sugarcane producers.
"They are also saying fuel has gone up and also the National Railways of Zimbabwe has increased its transportation costs by as much as 120 percent," he said.
"Prices of imported commodities have gone up because while government has availed the inter-bank trading platform, producers and retailers are finding it difficult to access foreign currency so they end up going to the parallel market," Jabangwe said.
Some consumers with more disposable income have resorted to buying in bulk to cushion themselves from more increases in the near future.
Tinashe Murombedzi said he would rather buy non-perishable goods than keep the money in the bank.
"It's better to convert my money to stock than to keep these RTGS dollars in the bank. Very soon the money in the bank will be worthless unless you have savings in foreign currency," he said.