MONTHLY ECONOMIC REVIEW
AUGUST 2014
Selected Economic Indicators

Stock Market Developments

Monetary Developments

Inflation

National Payments System

Statistical Tables

INSIDE THIS ISSUE

PAGE
SELECTED ECONOMIC INDICATORS

July

August
Month-on-
Month
Change
Z.S.E. Mining Index1
95.00
104.80
10.32%
Z.S.E. Industrial Index1
188.07
196.43
4.45%
Money Supply (Total Bank Deposits) (US$)2
4.22 billion
4.32 billion
2.32%
Money Supply (M3) Annual Growth2
9.58%
13.85%
2.32%
Yearly Inflation3
0.31%
0.15%
-0.31%
Nominal Lending Rate (%)
6.00-35.00
6.00-35.00

Sources:
1 Zimbabwe Stock Exchange
2 Reserve Bank of Zimbabwe
3 Zimbabwe National Statistics Agency (ZIMSTAT)


STOCK MARKET DEVELOPMENTS

The Zimbabwe Stock Exchange (ZSE)
registered gains in August 2014, despite the
lackluster
performance
of
some
listed
counters.
The
ZSE’s
industrial
index
recorded an increase of 4.5%, to close at
196.4 points. The increase was largely due to
trading
being
concentrated
in
heavily
capitalized counters. On a year-to-date basis,
however, the industrial index lost 2.8%.

The mining index maintained its upward
trend, gaining 10.3% to close at 104.8 points
in August 2014, from 95 points in July. The
gains were fueled by a rise of 66.7% in the
share price of Hwange. The mining index
gained 128.9%, on a year to date basis.

Shares traded totaled 328.3 million in volume
terms in August 2014, compared to 322.4
million shares in July 2014. Total turnover,
also rose by 163.2%, to close the month under
review at US$66.4 million. The trading
developments were largely supported by two
special bargain deals of 47.5 million BancABC
shares.

Buttressed by increases in the prices of heavily
capitalized
counters,
market
capitalization
increased by 4.6% to US$5.2 billion at the end
of August 2014, from US$4.9 billion at the
2 3
Source: Zimbabwe Stock Exchange, 2014.
Source: Zimbabwe Stock Exchange, 2014.
2 4
close of July 2014. On a year to date basis,
however, the ZSE’s market capitalization
fell by 2.8%.

MONETARY DEVELOPMENTS

Annual growth in broad money increased
further to 13.9% in August 2014. Broad
money stood at US$4 322.1 million in
August 2014, up from US$3 796.2 million in
August 2013. On a monthly basis, broad
million, respectively. These increases were,
however, partially offset by a US$27.6
million decline in short term deposits.

Against the background of an increase in
deposits, annual growth in domestic credit
rose to 6.2%, largely reflecting an 86.9%
increase in net credit to Government.
Underpinning the increase in net credit to
Government were Treasury bills holdings by
commercial and merchant banks, which
increased by 113.1% to US$237.5 million,
between August 2013 and August 2014.

Credit to the private sector continued to be
driven by loans and advances, which were
partly sustained by offshore lines of credit, as
Source: Reserve Bank of Zimbabwe, 2014.
money registered a 2.3% growth.

The annual growth in broad money was
underpinned by an increase in long term,
savings and demand deposits of US$315.1
million; US$129.2 million; and US$109.2
Source: Reserve Bank of Zimbabwe, 2014.
3 5
local
sources
of
liquidity
remained
constrained. Lending to the private sector by
banks declined to US$3 117.9 million in
August 2014, from US$3 165.4 million in
August 2013.

Credit to the private sector was mainly
composed of loans and advances, 83.7%;
mortgages, 11.9%; banker’s acceptances,
0.6%; bills discounted, 1.9%; and other
investments, 1.9%. The loans and advances
were mainly extended to agriculture (18.7%),
distribution (16.9%), and manufacturing
(14.4%). Individuals accounted for 16.1% of
total loans and advances.

The private sector borrowed mainly for
unclassified asset purchases (43.7%) as well
as inventory build-up (34.0%). Loans and
advances utilized for fixed investment activity
have remained low, with the procurement of
plant and equipment accounting for 3.4% and
pre and post shipment financing at 1.9%, of
total loans and advances.


INFLATION DEVELOPMENTS


Annual Inflation

Annual headline inflation retreated from
0.31% in July 2014, to 0.15% in August 2014.
This was largely on account of declines in
both food and non-food inflation.

Annual food inflation eased from -2.9% in
July 2014, to -2.8% in August 2014. All food
categories, except unclassified food items,
registered price decreases in August 2014.

The combined effect of improved domestic
and global food supply, as well as depressed
effective demand resulted in a fall in food
prices.

Annual non-food inflation retreated from to
1.9% in July 2014, to 1.6% in August 2014,
mainly driven by declines in health, recreation
Source: Reserve Bank of Zimbabwe, 2014.
4 6
and culture, as well as housing, water,
electricity, gas and other fuels categories.
Month-on-Month Inflation
Month-on-month inflation stood at -0.3% in
August 2014, shedding 0.3 percentage points
from the 0.01% recorded in July 2014. This
decline was mainly driven by decreases in
monthly food and non alcoholic beverages.
Monthly food inflation decelerated to -0.8%
in August 2014, from -0.5% in July 2014.
This was on account of a continued decline in
vegetables, bread and cereals, milk, cheese,
eggs, oil and fats, coffee, tea and cocoa, and
meat prices from previous month levels.
Monthly non-food inflation retreated from
0.2% in July 2014, to -0.1% in August 2014,
following decreases in the prices of clothing
and footwear as well as furniture and
household equipment.

NATIONAL
PAYMENTS
SYSTEM
DEVELOPMENTS
Zimbabwe Electronic Transfer Settlement
System (ZETSS)
The value of transactions processed through
the Real Time Gross Settlement system in
August 2014 decreased by 11% to US$3.5
billion, from US$3.9 billion recorded in
July 2014. Concomitantly, the volume of
transactions registered a decrease of 14%
from 199 587 to 170 858 in the same period.
Card Based Transactions
The total value of card based transactions
increased by 4.2% to US$409.3 million in
August 2014, from US$392.8 million in July
2014.


Source: ZIMSTATS, 2014.

Mobile and Internet Based Transactions
The value of mobile and internet based
transactions increased by 2.3%, from
US$414.1
million
in
July
2014,
to
US$423.6 million in August 2014.

Cheque Transactions
The value of cheque transactions stood at
US$9.4 million in August 2014, down from
US$11.7 million in July 2014.


Reserve Bank of Zimbabwe
September 2014

Source: Reserve Bank of Zimbabwe, 2014.

NOTES

STATISTICAL TABLES
CONTENTS

Table


. Monetary Statistics


1.1 Monetary Aggregates

1.2 Broad Money Survey

1.3 Analysis of Monthly Changes in Money Supply

1.4 Analysis of Yearly Changes in Money Supply

2. Sectoral Analysis of Bank Loans and Advances and Deposits


2.1 Sectoral Analysis of Commercial Banks Loans and Advances 15

2.2 Sectoral Analysis of Merchant Banks Loans and Advances

2.3 Sectoral Analysis of Merchant Acceptances

2.4 Sectoral Analysis of Commercial Banks Deposits

2.5 Sectoral Analysis of Merchant Banks Deposits

3. External Statistics


3.1 Total External Debt Outstanding by Debtor

4. Interest Rates


4.1 Lending Rates

4.2 Banks Deposit Rates

5. Inflation


5.1 Monthly Inflation

5.2 Yearly Inflation

6. Exchange Rates

STATISTICAL TABLES
CONTENTS

Table


. Commercial Banks


7.1 Assets

7.2 Liabilities

8. Accepting Houses


8.1 Assets

8.2 Liabilities

9. Building Societies


9.1 Assets

9.2 Liabilities

10. Zimbabwe Stock Exchange Statistics

11. Savings with Financial Institutions

12. Analysis of Liquid Assets of Monetary Banks

13. ZETSS, Cheques and Cards Activity


13.1 Values of Transactions

13.2 Volumes of Transactions

1. These are large corporation with business operations covering across a number of sectors.
TABLE 2.1 : SECTORAL ANALYSIS OF COMMERCIAL BANKS LOANS AND ADVANCES


US$ Thousands


AGRICULTURE
CONSTRUCTION
COMMUNICATION
DISTRIBUTION
FINANCIAL
&
FINANCIAL
MANUFACTURING
MINING
SERVICES TRANSPORT
INDIVIDUALS
CONGLOMERATES/1
TOTAL
END OF


INVESTMENTS
ORGANISATIONS

JANUARY

FREBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST

SEPTEMBER

OCTOBER

NOVEMBER

DECEMBER


JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST


TABLE 2.2: SECTORAL ANALYSIS OF COMMERCIAL BANKS DEPOSITS


US$ Thousands


END OF
AGRICULTURE
CONSTRUCTION
COMMUNICATIONS
DISTRIBUTION
FINANCIAL
&
FINANCIAL MANUFACTURING
MINING
SERVICES TRANSPORT
INDIVIDUALS
CONGLOMERATES
TOTAL


INVESTMENTS
ORGANISATIONS

JUNE

JULY

AUGUST

SEPTEMBER

OCTOBER

NOVEMBER

DECEMBER


JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST

SEPTEMBER

OCTOBER

NOVEMBER

DECEMBER


JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST


TABLE 3.1: ZIMBABWE: EXTERNAL DEBT OUTSTANDING BY DEBTOR (INCLUDING ALL
ARREARS) (WITH RBZ)


End Period

(US$ millions)


Long-Term External Debt


Government

Bilateral Creditors


Multilateral Creditors

Private Creditors

Public Enterprises

1,092
1,198
1,356
Bilateral Creditors

Multilateral Creditors

Private Creditors

Monetary Authorities

Multilateral Creditors - IMF

Private

1,002
Short-Term External Debt

1,198
1,382
1,289

1,564
Supplier's Credits

Reserve Bank

Private

Total External Debt


Gross Domestic Product

External Debt / GDP


SOURCE: Ministry of
Finance and Reserve Bank
of Zimbabwe

TABLE 4.1 LENDING RATES (percent per annum)1

Commercial Banks
Merchant Banks


Weighted Average Lending
Rates3

Weighted Average Lending
Rates3
End Period
Nominal
Lending
Rates2
Individuals
Corporate
Nominal
Lending
Rates2
Individuals
Corporate

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

June

July

August


Notes


1. Table revised, to separate weighted lending rates for individuals and corporate bodies.
2. Nominal Lending Rates depict the range of rates quoted by banks.
3. Lending rates exclude rates on staff loans.

TABLE 4.2 : BANKS DEPOSIT RATES (percent per annum)1


COMMERCIAL BANKS
ACCEPTING HOUSES


END OF
SAVINGS
3 MONTHS
3 MONTHS

JANUARY
0.15-8.00
4.00-20.00
6.00-17.00
FEBRUARY
0.15-8.00
4.00-20.00
6.00-17.00
MARCH
0.15-8.00
4.00-20.00
8.00-12.00
APRIL
0.15-8.00
4.00-20.00
8.00-12.00
MAY
0.15-8.00
4.00-20.00
6.00-17.00
JUNE
0.15-8.00
4.00-20.00
6.00-17.00
JULY
0.15-8.00
3.00-20.00
6.00-17.00
AUGUST
0.15-8.00
3.00-20.00
6.00-17.00
SEPTEMBER
0.15-8.00
3.00-20.00
11.00-12.00
OCTOBER
0.15--8.00
3.00-20.00
11.00-12.00
NOVEMBER
0.15--8.00
3.00-20.00
11.00-12.00
DECEMBER
0.15--8.00
3.00-20.00
11.00-12.00

JANUARY
0.15--8.00
3.00-20.00
11.00-12.00
FEBRUARY
0.15--8.00
3.00-20.00
11.00-12.00
MARCH
0.15--8.00
3.00-20.00
11.00-12.00
APRIL
0.15--8.00
3.00-20.00
11.00-12.00
MAY
0.15-8.00
3.00-20.00
11.00-12.00
JUNE
0.15-8.00
3.00-20.00
11.00-12.00
JULY
0.15-8.00
3.00-20.00
11.00-12.00
AUGUST
0.15-8.00
4.00-20.00
11.00-12.00


1.
The range of rates quoted by banks during the period.
2.
Three (3) months deposit rates revised to exclude rates on inactive or dormant
accounts.


NON-FOOD INFLATION
FOOD
INFLATION
ALL

ALCOHOLIC
BEVERAGES
CLOTHING
HSING,
WATER,
FURNITURE HEALTH
TRANSPOR
T
COMMUNICATION
RECREATION
&
EDUCATION
RESTAURANTS &
MISC.
TOTAL
NON
FOOD &
ITEMS

& TOBACCO
FOOTWEAR
ELECTRICTY,
GAS
AND


CULTURE

HOTELS
GOODS &
FOOD
NON
ALCOHOLIC
BEVERAGES


& OTHER
EQUIPMENT


SERVICES


FUELS


WEIGHTS


OCTOBER

NOVEMBER

DECEMBER


JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST


TABLE 5.1 : MONTHLY INFLATION -- PERCENTAGE CHANGE IN CONSUMER PRICE INDEX \1
( DECEMBER 2012 = 100)

NON-FOOD INFLATION
FOOD
INFLATION
ALL

ALCOHOLIC BEVERAGES
CLOTHING
HSING,
WATER,
FURNITURE
HEALTH
TRANSPORT
COMMUNICATION
RECREATION &
EDUCATION
RESTAURANTS &
MISC.
TOTAL
NON
FOOD &
ITEMS

& TOBACCO
FOOTWEAR
ELECTRICTY, GAS
AND


CULTURE
HOTELS
GOODS &
FOOD
NON ALCOHOLIC
BEVERAG-


& OTHER
EQUIPMENT


SERVICES


FUELS


WEIGHTS


SEPTEMBER

OCTOBER

NOVEMBER

DECEMBER


JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST


TABLE 5.2 : YEARLY INFLATION -- PERCENTAGE CHANGE IN CONSUMER PRICE INDEX \1
(DECEMBER 2012 = 100)

TABLE 6 : SELECTED INTERNATIONAL EXCHANGE RATES


SA
BW
JAPANESE
EUROPEAN
POUND
END OF
RAND/1
PULA/1
YEN/1
CURRENCY/2
STERLING/2

JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST

SEPTEMBER

OCTOBER

NOVEMBER

DECEMBER


JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST


1. Foreign currency per US Dollar.


2. US Dollar per unit of foreign currency.

TABLE 7.1: COMMERCIAL BANKS - ASSETS


US$ Millions


Liquid Assets


Securities


Loans & Contingent
Other
Non
Financial
Total
End of
Notes


Total
Other Balances Advances
Assets
Assets
Assets
Assets

&
Balances
Balances
Balances


Liquid
with RBZ


Coin
with
with Other
at
Trade
Treasury Agric PEs
Assets


at Banks
RBZ
Banks
Foreign
Banks
Bills
Bills

May

Jun

Jul

Aug.

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

Jun

Jul

Aug


TABLE 7.2: COMMERCIAL BANKS - LIABILITIES
US$ Millions


Deposits


Amounts Owing to
Capital
Contingent
Other
Total
Of which


and
Liabilities Liabilities Liabilities Liabilities
to the
End of
Demand
Savings and
Short-term
Long-term
Total
Foreign
Liabilities
RBZ
Other Banks Reserves


Public


Deposits

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

Jun

Jul

Aug


TABLE 8.1 : ACCEPTING HOUSES - ASSETS
US$ Millions


Liquid Assets


Loans & Contingent
Other
Non Financial
Total

End of
Notes


Total
Other
Balances Advances
Assets
Assets
Assets
Assets


&
Balances Balances Balances


Liquid
with RBZ


Coin
with
with Other
at
Trade
Treasury
Assets


at Banks
RBZ
Banks
Foreign
Banks
Bills
Bills

Aug


Sep


Oct


Nov


Dec


Jan


Feb


Mar


Apr


May


Jun


Jul


Aug


TABLE 8.2 : ACCEPTING HOUSES - LIABILITIES
US$ Millions


Of which


Deposits


Amounts Owing to
Capital
Contingent
Other
Total
Liabilities to the


and
Liabilities
Liabilities
Liabilities
Public
End of Demand Savings and
Short-term
Long-term
Total
Foreign
Liabilities
RBZ
Other
Banks
Reserves


Deposits

Aug

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

Jun

Jul

Aug


TABLE 9.1 : BUILDING SOCIETIES - ASSETS
US$ Millions


Liquid Assets


Notes
Balances
Trade
Treasury
Total
Mortgage
Other
Other
Non Financial
Total
End of
&
with Other
Bills
Bills
Liquid
Advances
Advances
Assets
Assets
Assets

Coin
Banks


Assets


at Banks

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

Jun

Jul

Aug


TABLE 9.2 : BUILDING SOCIETIES - LIABILITIES
US$ Millions


Of which

Deposits
Capital
Other
Total
Liabilities to the


and
Liabilities
Liabilities
Public
End of
Savings and
Short-term
Long-term
Total
Reserves


Deposits

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Jan

Feb

Mar

Apr

May

Jun

July

Aug


Table 10: ZIMBABWE STOCK MARKET STATISTICS


Indices
US$ Millions

Industrial
Mining
Market Capitalisation

Jan
179.34
84.07
4,700.33
Feb
182.3
72.01
4,748.24
Mar
183.88
66.21
4,726.34
Apr
189.66
71.98
4,894.68
May
212.72
73.99
5,471.22
Jun
211.19
73.29
5,436.57
Jul
232.87
66.77
5,9136.78
Aug
181.67
48.73
4,682.27
Sep
200.05
49.90
5,157.20
Oct
209.74
52.68
5,407.42
Nov
213.04
47.02
5,482.03
Dec
202.12
45.79
5,203.13

Jan
189.25
35.40
4,882.11
Feb
189.45
39.24
4,906.94
Mar
176.32
29.51
4,560.29
Apr
172.91
29.64
4,473.51
May
174.89
35.45
4,485.11
Jun
186.57
61.32
4,873.40
July
188.07
95.00
4,959.21
Aug
196.43
104.8
5,186.63


Source: Zimbabwe Stock Exchange (ZSE)

TABLE 11 : SAVINGS /1 WITH FINANCIAL INSTITUTIONS


US$ Millions


Commercial
Merchant

Building

End of
Banks
Banks
Other/2
Societies
TOTAL

January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

Aug


1/ Comprises all deposits other than demand deposits.
2/ Includes People’s Own Savings Bank (POSB).

TABLE 12 : ANALYSIS OF LIQUID ASSETS OF MONETARY BANKS


US$ Millions


Commercial Banks
Accepting Houses


Liquid
Prescribed
Excess
Liquid
Prescribed
Excess

assets
liquid
liquid
assets
liquid
Liquid
End of
held
assets/1
assets
held
assets/1
assets

January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August


1/ With effect from May 2012, the prescribed liquid asset ratio was reviewed to 30% of liabilities to the public.

TABLE 13.1 : ZETSS AND RETAIL PAYMENTS TRANSACTIONAL ACTIVITY
Values of Transactions (US$ in millions)
MONTH
ZETSS
CHEQUE
POS
ATM
MOBILE
INTERNET

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Annual Total


Jan

Feb

Mar

Apr

May

June

July

August


TABLE 13.2 : ZETSS AND RETAIL PAYMENTS TRANSACTIONAL ACTIVITY
Volumes of Transactions (in thousands)
MONTH
ZETSS
CHEQUE
POS
ATM
MOBILE
INTERNET

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec


Annual Total


Jan

Feb

Mar

Apr

May

Jun

July

August

33.84