By Clever Kapepa
AUTHORITIES have announced Zimbabwe introduce a currency in the next 14 days. Reserve Bank of Zimbabwe Governor John Mangudya told a press conference after the monetary policy committee meeting, that the new currency will be issued in $2 and $5 notes as a way of dealing with the parallel money market.
“The committee noted that the level of physical cash in the economy is inadequate to meet transactional demand, considering that the current proportion of cash to broad money of 4% is low compared to regional and international levels of 10-15%.
This low ratio has resulted in an undesirable cash premium which the Committee would like to see eliminated,” Mangudya said. The bank said in 2019, the economy reached new levels of electronic money usage.
“However, the committee felt that there was a need to boost the domestic availability of cash for transactional purposes through a gradual increase in cash supply over the next six months.
“The committee also noted the need to review upwards the cash withdrawal limits to ease the burden on the transacting public. This additional cash injection will be carried out through the non-inflationary exchange of RTGS money for physical cash,” Mangudya said.
Government last month denied reports that a new currency was being minted and would be introduced in November.
Monetary Policy Committee member Eddie Cross in an interview with nEWS263zim.com however stuck to his guns despite the denial arguing he had not made any announcement but was only saying what President Emmerson Mnangagwa had consistently said.
Mnangagwa however had given three separate dates including the first quarter of 2020 for the introduction of the new currency. Zimbabweans have had to sleep in queues for years to access cash which has been selling at a premium on the parallel market.