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Despite New Zimbabwe Z$50,000 Note, Banks Exhaust Cash

Barely two weeks after it introduced new notes for Z$10,000 and Z$20,000 in a bid to relieve cash shortages, the Reserve Bank of Zimbabwe on Monday issued a Z$50,000 bank note while increasing the daily limit on bank withdrawals for individuals to that amount.

Despite the release of the new note, sources in Harare said many banks ran out of cash due to the higher withdrawal limit, as the Reserve Bank had not supplied them with the larger bank notes. Sources in Bulawayo said much the same situation developed there.

Economist Godfrey Kanyenze of the Labor and Economic Development Research Institute of Zimbabwe told reporter Jonga Kandemiiri of VOA's Studio 7 for Zimbabwe that the Reserve Bank must move to control inflation instead of continuing to issue larger notes.

The Zimbabwe Congress of Trade Unions demanded the abolition of withdrawal limits despite the central bank's recent moves. Last month it gave the Reserve Bank an ultimatum to take action to relieve cash shortages, failing which it would launch industrial action.

ZCTU Deputy Secretary General Japhet Moyo said the union is still consulting with its members as to how to proceed amid continuing shortages of cash for ordinary transactions.

More reports from VOA's Studio 7 for Zimbabwe...