Zimbabwe central bank took a decision to formalize the multi-currency system introduced during hyper-inflation in the country’s economy by phasing-out local currency.
As inflation hit six years ago, foreign currencies like the US dollar and South African Rand came into use in Zimbabwe.
The Hyper-inflation resulted in the decrease of the Zimbabwean dollar rate. The rate diminished so least that the last bank note printed by Zimbabwe was for Z$100 billion, still not enough for a bus ticket.
Hyper-inflation resulted in prices in shops change several times a day, severe shortages of basic goods. The Zimbabweans had to carry their money in wheelbarrows to buy a Kilo of potatoes.
Central bank Governor John Mangudya said, “The move has been pending and long outstanding, We cannot have two legal currency systems. We need therefore to safeguard the integrity of the multiple-currency system or dollarization in Zimbabwe. Zimbabweans have until the end of September to exchange their local dollar” .
After the latest move by the Zimbabwe central bank, Zimbabweans can exchange bank accounts of up to 175 quadrillion (175,000,000,000,000,000) Zimbabwean dollars for five US dollars.
That means Z$35 quadrillion equals to US$1!!!
