ZIMBABWE -Will introduce some Zimbabwe dollar notes and coins in the next two weeks, the latest step towards fully restoring the domestic currency, central bank governor John Mangudya said on Tuesday.
The central bank unexpectedly reintroduced the Zimbabwe dollar on June 24, ending a decade of dollarisation, but the currency has plummeted against the U.S. dollar. Mangudya blamed the depreciation on an increase in money supply by 80% during the first eight months of this year.
Zimbabwe abandoned its own currency in 2009 after it was wrecked by hyperinflation, but three-digit inflation that has eaten into salaries and savings has evoked the dark days of the 2008 hyperinflation under the late Robert Mugabe.
The new money, consisting of 5-dollar notes and 2-dollar coins, will be introduced gradually to avoid driving up inflation, Mangudya said. It will circulate alongside the bond notes and coins introduced in 2016 as a surrogate for U.S. dollars, which the country was then mainly using in lieu of its own currency.
“For a start, we thought of being conservative (in introducing low denomination notes and coins) and we will graduate with time,” Mangudya told reporters after a two-day monetary policy committee meeting.
He would not say how much money would be produced.