In a much anticipated monetary
policy statement, Reserve Bank Governor Gideon Gono announced Wednesday that the
central bank will tackle the effects of hyperinflation by rolling out new currency while slashing 10 zeros from
denominations now in circulation.
Correspondent Sylvia Manika
reported on Gono's monetary policy statement.
Economists
said the redenomination is necessary, but won’t put the brakes on hyperinflation
which one estimated to be running now at 100 million percent on a 12-month basis.
Economist Godfrey Kanyenze of the Labor and Economic Development Research Institute of Zimbabwe said the zeros will
return sooner than the last time they were slashed, in 2006, as the rate of
inflation is far higher now than it was at that time.
Informal foreign exchange markets took the currency announcement in stride, with the local currency trading at Z$110 billion to the U.S. dollar in Harare, Bulawayo and Mutare, much as in trading the day before. Existing bills won't expire until December 31 although the new currency regimen will go into force on Friday, August 1.
Independent
economist John Robertson agreed the zeros will soon be back on notes without a concerted
effort to tackle the root causes of hyperinflation.
Bulawayo-based
journalist Jonah Nyoni commented that what needs to be removed is not the zeroes from the currency but the leadership of the country.
More reports from VOA's Studio 7 for Zimbabwe...
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