Zimbabwe’s central bank has today released the new note into circulation in their attempt to battle hyperinflation…
Zimbabwe’s central bank has today launched a $50billion note into circulation, despite the currency being virtually worthless, as per Money.co.uk reports. According to today’s estimates the $50billion note will trade at $1.25 US dollars on the black market and have enough purchase power to buy just two loaves of bread or three newspapers.
Three weeks previous, when the government introduced a $10billion note, the equivalent £50billion would have been worth $3.30 US dollars, illustrating the currency’s severe decline in value. A $20billion note has also been released as part of Acting Finance Minister, Patrick Chinamasa’s bid to tackle the cash shortages currently gripping the country.
This actually represents the second issue of such high value notes after the government were forced to revalue the currency and remove 10 zeros (effectively turning Z$10billion to just Z$1) in August last year.
Poverty stricken Zimbabwe is currently struggling with an unprecedented economic crisis. Almost 80% of its population is unemployed, its currency is dropping in value by almost 100% a day and inflation is running at a staggering 231million%. As a point of comparison, the official rate of inflation in the UK, the Consumer Prices Index, currently sits at 4.1%.
Hyperinflation has become such an issue that few are trading in the nation’s official currency. US dollars and South African rand have instead been adopted as a more viable alternative. While the situation is nothing short of dire it is difficult to see how this move by Zimbabwe’s central bank will better the situation. Many have argued that a resolution of the country’s grid-locked government can be the only possible reprieve for the situation.
