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Zimbabwe Currency Loses Three Zeros

Zimbabwe has devalued its dollar and will, as of Tuesday, have new bank notes that will have three zeros less than the current ones.

Zimbabwe central bank Governor Gideon Gono said slashing three zeros off the bank notes was meant to make it easier for Zimbabwean consumers reeling under an inflation rate of close to 1,200 percent. Zimbabwean's had been carrying piles of money for the most basic of transactions.

The hyperinflation resulted in a shortage of bank notes, while coins and low denomination notes simply became redundant.

In 2003 Zimbabwe introduced the so-called bearer checks that would act temporarily as legal tender. But they are still in circulation with the highest denomination being 100,000 Zimbabwe dollars - equal in value to less than one U.S. dollar.

Zimbabweans have three weeks to exchange old for new bearer checks. The Institute of Chartered Accountants of Zimbabwe recently recommended the slashing of three zeros as bank software was failing to compute the numerous zeros.

Welcoming the move, a Harare housewife who spoke to VOA on condition of anonymity, said though prices of goods would remain the same, it would make things better as shoppers no longer have to carry so many notes around. A loaf of bread had been priced at 200,000 Zimbabwe dollars.

During a televised address, Gono also devalued the new Zimbabwe dollar by more than half to 250 per U.S. dollar. He also cut the lending rate from 550 percent to 300 percent as part of measures to breathe new life into what economists describe as the fastest shrinking economy in the world.

Zimbabwe is going through its worst economic crisis since independence in 1980. Power outages are routine, unemployment stands at more than 80 percent, and food, fuel and foreign currency are in short supply.