Poor ZiG: Clueless RBZ Scapegoats ‘Currency Saboteurs'
In a move that screams “we're trying our best, honest!“, Zimbabwe's central bank has vowed to “double efforts” against those it blames for the plummeting value of the nation's bullion-backed currency, the ZiG (Zimbabwe Gold), on the parallel market.
Money Changers Resurface as ZiG Marginally Weakens
According to ZimPriceCheck.com, the ZiG is being quoted at a wild range of 16 to 26 to the dollar on the parallel market, while the official rate sits at a much more modest 13.94 per dollar. The central bank's website confirmed this on Thursday, but the discrepancy is causing quite the stir.
Governor John Mushayavanhu pointed fingers at “unscrupulous traders and individuals” for allegedly quoting sky-high exchange rates when selling goods and services in ZiG. He was quick to remind everyone that parallel market rates in a dual economy shouldn't be seen as the true value of the exchange rate. Sure, John, we'll take your word for it.
The latest currency chaos coincides with a surge in demand for dollars, reigniting parallel market activity. After the ZiG's launch on April 8, trade on the unofficial market slowed due to a crackdown by the financial intelligence unit and police. Some street dealers were arrested, while others took their business to WhatsApp, away from prying eyes.
Poor ZiG: Clueless RBZ Scapegoats ‘Currency Saboteurs'
Mushayavanhu assured that the Reserve Bank of Zimbabwe and the financial intelligence unit will “double their efforts” to enforce foreign exchange and currency regulations. The central bank will also keep a close eye on the parallel market to “mitigate against extreme exchange rate distortions.” Because, you know, that's been working so well so far.
Since 2009, Zimbabweans have relied on US dollars for everyday expenses like transport, medicine, and food, after hyperinflation wiped out their savings. The ZiG is the country's sixth attempt at a functional local currency in 15 years.
The current rush for US dollars is largely speculative, stemming from “the country's unfortunate past episodes with local currencies,” Mushayavanhu said. He promised policy certainty, stronger market guidance, and restoring the central bank's credibility.
Shops Re-embrace USD as ZiG Continues to Weaken
Meanwhile, the ZiG weakened for the 11th consecutive day on Thursday, marking its longest losing streak since its adoption. But hey, at least they're doubling their efforts, right?
