By Patience Gondo
RISING fuel prices are increasingly feeding into Zimbabwe’s inflation and pushing up costs across key sectors.
According to the Zimbabwe National Statistics Agency, annual inflation in the local currency (ZiG) rose to 4.8% in April from 4.4% in March, largely driven by increases in transport and food prices.
Monetary authorities have already warned of short-term price pressures.
The Reserve Bank of Zimbabwe recently indicated that inflation is expected to rise in the near term, mainly due to fuel-related costs, before stabilising later in the year.
The central bank has maintained the policy rate at 35% to contain inflation and prevent further price escalation.
The impact of rising fuel costs is now evident in the construction sector.
ZimStat data shows that prices for civil engineering materials increased by 6.7% in March in U.S. dollar terms, while ZiG-denominated costs rose by 7.1%.
Over the first quarter, building material prices also recorded steady increases, highlighting the growing cost burden on contractors.
Higher fuel prices are driving up transport and production expenses, affecting supply chains and overall project costs.
Contractors working under fixed-price contracts are facing mounting pressure as input costs continue to rise, squeezing profit margins.
Globally, rising energy costs and supply disruptions have contributed to inflationary pressures, a trend also noted by the International Monetary Fund, which links higher fuel prices to broader increases in the cost of goods and services.
With fuel prices expected to remain elevated, the ripple effects could persist, placing further strain on businesses and reducing consumers purchasing power in the months ahead.