The United States and other currencies have bounced back in Zimbabwe following a decision by the central bank to allow people to purchase local goods and pay for services chargeable in bond notes and Real Time Gross Settlement (RTGS) dollars.
In a statement posted on its website, the Reserve Bank of Zimbabwe this was designed to facilitate the easy purchasing of commodities in the country in the wake of the outbreak of the coronavirus pandemic.
“… The Reserve Bank of Zimbabwe would like to advise the public that it is making it easier for the transacting public to conduct business during this difficult period by making available an option to use free funds to pay for goods and services chargeable in local currency.
“This intervention takes into account the country’s limited access to foreign finance, which is adversely affecting the country’s balance of payments position. Related to the above measures, Government, through the Bank, has suspended the managed floating exchange rate system to provide for greater certainty in the pricing of goods and services in the economy. In its place, the Bank has, with immediate effect, adopted a fixed exchange rate system at the current interbank level of ZW$25 to the US$. This measure will be reviewed when markets stabilise from the effects of COVID-19.”
Zimbabwe banned the use of foreign currencies as legal tender last year, almost 10 years after the local currency was dumped due to hyperinflation.