Zimbabwean dollar (2019–present)
The Zimbabwean dollar (sign: Z$; code: ZWL),[5] also known as the Zimdollar or Real Time Gross Settlement (RTGS) dollar,[6][7] is one of the official currencies of Zimbabwe. It was the only official currency in Zimbabwe from June 2019 to March 2020, after which foreign currencies were legalised again.[8]
Z$ | |
|---|---|
Banknotes | |
| ISO 4217 | |
| Code | ZWL (numeric: 932) [a][2] |
| Subunit | 0.01 |
| Unit | |
| Unit | dollar |
| Symbol | $ |
| Nickname | Zimdollar, Zollar |
| Denominations | |
| Subunit | |
| 1⁄100 | cent |
| Symbol | |
| cent | ¢ |
| Banknotes | |
| Freq. used | $10, $20, $50, $100 |
| Rarely used | $2, $5[3] |
| Coins | |
| Rarely used | 1¢, 5¢, 10¢, 25¢, 50¢, $1, $2 |
| Demographics | |
| Date of introduction | 25 February 2019[4] |
| User(s) | Zimbabwe |
| Issuance | |
| Central bank | Reserve Bank of Zimbabwe |
| Website | www |
| Printer | |
| Mint | South African Mint |
| Valuation | |
| Inflation | 254.96% |
| Source | , November 2022 |
| Method | CPI |
History edit
Background edit
On 29 January 2009, the Zimbabwean government legalised the use of foreign currencies, such as the United States dollar and the South African rand: in response, Zimbabweans quickly abandoned the old Zimbabwean dollar, which was collapsing from what was at the time the second highest rate of hyperinflation (after the Hungarian pengő in 1946).[9][10] On 12 April 2009, the power-sharing government of then-Prime Minister Morgan Tsvangirai suspended the old dollar, and the Reserve Bank of Zimbabwe demonetised the last banknotes of the old dollar, on 30 September 2015.[11][12]
The multi-currency system eventually resulted in a liquidity crisis, because Zimbabwe had to import more than what they could export, resulting in a net exodus of US dollars:[13] eventually, the Reserve Bank introduced a series of bond coins on 18 December 2014, and bond notes on 28 November 2016, after securing a total of US$250 million in loans from the African Export-Import Bank.[14][15]
Although bond money was officially interchangeable at par with the US dollar, the general public quickly resisted them as an attempt to reintroduce the Zimbabwean dollar, which had gained a bad reputation due to hyperinflation.[16] That, along with the continued shortage of US dollars in Zimbabwe,[17] resulted in a thriving parallel exchange rate that ranged between $3.00 and $3.80 in bond money to the US dollar, in February 2019.[18]
Introduction of the fifth dollar edit
The parallel rate and the continued shortage of US dollars created a situation where the Reserve Bank could no longer maintain the peg with the US dollar: the Reserve Bank also wanted to end the system of different exchange rates, which resulted in customers paying more or less depending on the payment method.[19] On 20 February 2019, Reserve Bank governor John Mangudya announced the introduction of the current Zimbabwean dollar, initially called the Real Time Gross Settlement dollar (RTGS dollar).[20] The RTGS dollar, which started trading on 25 February, consisted of real-time gross settlement balances (hence the name), and existing bond notes and bond coins (both of which were devalued by 60% to Z$2.50 per US dollar).[4][21]
On 24 June 2019, the Zimbabwean government renamed the RTGS dollar to the Zimbabwean dollar,[22] and banned the use of foreign currencies in an attempt to end the multi-currency system: the BBC reported widespread opposition to the ban, partly due to continued public distrust, partly due to high inflation, and partly due to traders still having to use hard currencies to import goods from abroad.[23] The onset of the coronavirus pandemic eventually forced the Reserve Bank to reinstate the multi-currency system, on 29 March 2020.[24]
On 29 October 2019, the Reserve Bank claimed that a new currency would replace the fifth dollar.[25] This claim turned out to be a new $2 bond coin, and revised $2 and $5 banknotes without the "bond note" inscription: both entered circulation on 11 November 2019.[26][27] The Reserve Bank continues to introduce higher value banknotes, with the $100 note entering circulation on 5 April 2022.[28]
Continued high inflation edit
The fifth Zimbabwean dollar continues to experience very high inflation, due to continued public distrust,[29] and the continued shortage of hard currency as a result of importers being unable to use Zimbabwean dollars:[30] almost immediately after the Reserve Bank abolished the peg, the official rate to the US dollar declined to Z$2.80 on 22 March, and Z$6.00 on 12 June 2019, while the parallel rate fluctuated between Z$7.00 and Z$13.00 by 3 July.[18][31][32] The Reserve Bank's annual inflation rate surpassed 100% in June 2019, and 500% in December 2019.[33] As of December 2022[update], the Reserve Bank annual inflation rate was 243.76%: the highest (since February 2019) was 837.53% in July 2020, and the lowest was 50.25% in August 2021.[33] Use of Zimbabwean dollars in Zimbabwe declined in favour of hard currencies, and as a result, in February 2023, Zimbabwe switched its headline inflation rate to the one that blends Zimbabwean dollar and US dollar prices, which has been criticised by businesses for hiding the real inflation rate in local currency, which has persisted despite the use of a "blended" inflation rate.[34][35]
Banknotes edit
Zimbabwean banknotes that have entered circulation since 2016 have the signature of John Mangudya, who succeeded Charity Dhliwayo as the governor of the Reserve Bank of Zimbabwe on 1 May 2014.[36]
In 2022, the Reserve Bank started the process of removing $2 and $5 banknotes from circulation, due to long-term high inflation: on 5 April 2022, the official exchange rates for those banknotes were 1.4 and 3.5 US cents, respectively.[37][3]
Bond notes edit
The $2 and $5 bond notes entered circulation on 28 November 2016 and 3 February 2017, respectively.[15][38]
| Pick No. | Image | Value | Dimensions | Main colour | Description | Date of[39] | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Obverse | Reverse | Obverse | Reverse | Watermark | printing | issue | withdrawal | |||||
| 99 | $2 | 155 × 62 mm | Green | Domboremari with trees | Eternal Flame at the National Heroes Acre, and the Old Parliament House | Zimbabwe Bird and "RBZ" | 2016 | 28 November 2016 | 11 November 2019 | |||
| 100 | $5 | 155 × 66 mm | Purple | Domboremari with trees | Three giraffes and the Zimbabwe Aloe (Aloe excelsa) | Zimbabwe Bird and "RBZ" | 2016 | 3 February 2017 | 11 November 2019 | |||
| These images are to scale at 0.7 pixel per millimetre. For table standards, see the banknote specification table. | ||||||||||||
2019–present series edit
On 11 November 2019, the Reserve Bank issued regular banknotes for the first time since 2009, with commercial banks releasing them to the general public on the following day:[26][27] the regular $2 and $5 banknotes are identical to the bond notes, but they do not have the "bond note" inscription on either side. $10 and $20 notes entered circulation on 19 May and 1 June 2020, respectively.[40]
The $50 note entered circulation on 6 July 2021, and became the first Zimbabwean banknote since the withdrawal of the Rhodesian pound in 1970 to feature a person: a portrait of Mbuya Nehanda, a significant figure of Zimbabwean nationalism, appears on reverse with the Tomb of the Unknown Soldier at the National Heroes Acre.[41] This was followed by the $100 banknote on 5 April 2022, which featured the ruins of Great Zimbabwe.[3][28]
| Value | Dimensions | Main colour | Description | Date of | Ref. | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Obverse | Reverse | Watermark | printing | issue | withdrawal | |||||
| $2 | 155 × 62 mm | Green | Domboremari with trees | Eternal Flame at the National Heroes Acre, and the Old Parliament House | Zimbabwe Bird and "RBZ" | 2019 | 11 November 2019 | In progress | [42] | |
| $5 | 155 × 66 mm | Purple | Domboremari with trees | Three giraffes and the Zimbabwe Aloe (Aloe excelsa) | Zimbabwe Bird and "RBZ" | 2019 | 11 November 2019 | In progress | [43] | |
| $10 | 155 × 66 mm | Red | Domboremari with trees | New Reserve Bank Tower and four African buffaloes (Syncerus caffer) | Zimbabwe Bird and "RBZ" | 2020 | 19 May 2020 | Current | [44] | |
| $20 | 155 × 66 mm | Blue | Domboremari with trees | African elephant and Victoria Falls (Mosi-oa Tunya) | Zimbabwe Bird and "RBZ" | 2020 | 1 June 2020 | Current | [44] | |
| $50 | 155 × 66 mm | Brown | Domboremari with trees | Tomb of the Unknown Soldier at the National Heroes Acre, and Mbuya Nehanda | Zimbabwe Bird and "RBZ" | 2020 | 6 July 2021 | Current | [45] | |
| $100 | 155 × 66 mm | Yellow | Domboremari with trees | African baobab (Adansonia digitata) and the ruins of Great Zimbabwe | Zimbabwe Bird and "RBZ" | 2020 | 5 April 2022 | Current | [46] | |
| For table standards, see the banknote specification table. | ||||||||||
Relationship with foreign currencies edit
When the RTGS Dollar was introduced in February 2019, Zimbabweans used a mix of foreign currencies including the US dollar, the South African rand, and the Chinese yuan.[47] On 24 June 2019, the Zimbabwean government banned the use of foreign currencies in local transactions.[23] However, high inflation, continued public resistance to the Zimbabwean dollar, and the worsening coronavirus pandemic forced the government to allow Zimbabweans to use foreign currencies again, in March 2020.[8] The government has said that the authorization to use US dollars in local transactions is just temporary,[48] but by June 2020, some Zimbabwean civil service personnel were already demanding payment of their salaries in US dollars, due to hyperinflation in the Zimdollar.[49]
Exchange rates edit
By March 2020, an attempt was made to peg the so-called Zimdollar at US$1 = 25 RTGS$,[50] but inflation continued and this effort was abandoned.[49][51]
Annual inflation in the period ending July 2020 was 837.53% as reported by ZIMSTAT.[52]
The exchange rate is determined by the forces of supply and demand on an auction market the Reserve Bank of Zimbabwe set up along with the announcement of the RTGS dollar. The market is called Interbank Foreign Currency Exchange Market and is made up of banks and bureaux de change.[53]
A new weekly auction of foreign currency was set up in late June 2020 by the Reserve Bank of Zimbabwe to attempt to curb the rampant inflation which had driven the Zimdollar down to US$1 = 80 Zimdollars.[54] Inflation continued for the Zimdollar, and by May 2022, it was "officially quoted at 165.94 against the U.S. dollar while sliding continuously on the black market, where it is [was] currently trading between 330 and 400 to the US dollar."[55] In an attempt to stop additional speculation in the Zimdollar, in May 2022, the Treasury ordered banks to stop lending, to be effective immediately.[55]
In July 2022 the Reserve Bank of Zimbabwe announced the introduction of official gold coins into the market "as a store of value".[56] The gold coins are called "Mosi-oa-Tunya", and they are expected to be sold for either Zimdollars or United States dollars at rates based upon the prevailing international price of gold plus the costs of production.[56][57]
| Current ZWL exchange rates | |
|---|---|
| From Google Finance: | AUD CAD CHF CNY EUR GBP HKD JPY USD BWP ZAR |
| From Yahoo! Finance: | AUD CAD CHF CNY EUR GBP HKD JPY USD BWP ZAR |
| From XE.com: | AUD CAD CHF CNY EUR GBP HKD JPY USD BWP ZAR |
| From OANDA: | AUD CAD CHF CNY EUR GBP HKD JPY USD BWP ZAR |
See also edit
Notes edit
- ^ The current Zimbabwean dollar reuses the ISO code ZWL, which was assigned on 6 February 2009.[1] For the local currency in use from 1980 to 12 April 2009, see Zimbabwean dollar.
References edit
- ^ ISO 4217 MA Secretariat (6 February 2009). (PDF). SIX Interbank Clearing. London: British Standards Institution. Archived from the original (PDF) on 12 December 2022. Retrieved 12 December 2022.
{{cite web}}: CS1 maint: numeric names: authors list (link) - ^ "List One: Currency, fund and precious metal codes" (XLS). www.six-group.com. SIX Group. 23 September 2022.
- ^ a b c . Pindula News. Pindula. 6 April 2022. Archived from the original on 6 April 2022. Retrieved 10 December 2022.
- ^ a b Winning, Alexander (25 February 2019). . Thomson Reuters Foundation. London: Thomson Reuters. Reuters. Archived from the original on 2 May 2019. Retrieved 12 December 2022.
- ^ . Bloomberg. Archived from the original on 23 September 2021. Retrieved 2 March 2021.
{{cite web}}: CS1 maint: bot: original URL status unknown (link) - ^ Muronzi, Chris (3 July 2019). "Hyperinflation trauma: Zimbabweans' uneasy new dollar". Al Jazeera.
- ^ "Zimbabwe struggles to keep its fledgling currency alive". The Economist. 23 May 2019.
- ^ a b Matiashe, Faral (15 April 2020). "Zimbabwe is on lockdown, but money-changers are still busy". Al Jazeera. from the original on 16 April 2020.
- ^ Biles, Peter (29 January 2009). . BBC News. London: BBC. Archived from the original on 23 October 2009. Retrieved 18 January 2023.
- ^ Hanke, Steve; Kwok, Alex (2009). "On the measurement of Zimbabwe's hyperinflation" (PDF). Cato Journal. Washington, D.C.: Cato Institute. 29 (2): 353–364. ISSN 0273-3072. Retrieved 18 January 2023.
- ^ . BBC News. London: BBC. 12 April 2009. Archived from the original on 15 April 2009. Retrieved 8 January 2023.
- ^ Mangudya, John (11 June 2015). (PDF). Reserve Bank of Zimbabwe. Harare. Archived from the original (PDF) on 11 July 2015. Retrieved 28 December 2022.
- ^ Crabtree, Justina (28 November 2016). . CNBC. Englewood Cliffs: NBCUniversal. Archived from the original on 29 November 2016. Retrieved 18 January 2023.
- ^ Mangudya, John (4 December 2014). (PDF). Reserve Bank of Zimbabwe. Harare. Archived from the original (PDF) on 20 October 2020. Retrieved 18 January 2023.
- ^ a b Musvanhiri, Privilege (28 November 2016). . DW.com. Bonn: Deutsche Welle. Archived from the original on 4 December 2016. Retrieved 11 December 2022.
- ^ Harare Correspondent (22 December 2014). . The Mail & Guardian. Johannesburg: M&G Media. Archived from the original on 24 December 2014. Retrieved 18 January 2023.
- ^ Wallace, Paul (13 September 2018). . Bloomberg. New York City: Bloomberg L.P. Archived from the original on 13 September 2018. Retrieved 18 January 2023.
- ^ a b Zwinoira, Tatira (22 March 2019). . NewsDay Zimbabwe. Harare: Alpha Media Holdings. Archived from the original on 23 March 2019. Retrieved 12 December 2022.
- ^ . BBC News. London: BBC. 26 February 2019. Archived from the original on 27 February 2019. Retrieved 18 January 2023.
- ^ Mangudya, John (20 February 2019). (PDF). Reserve Bank of Zimbabwe. Harare. Archived from the original (PDF) on 6 May 2019. Retrieved 18 January 2023.
- ^ Staff Reporter (20 February 2019). . The Zimbabwe Mail. Archived from the original on 21 February 2019. Retrieved 18 January 2023.
- ^ Sguazzin, Antony; Ndlovu, Ray (24 June 2019). . New York City: Bloomberg L.P. Bloomberg News. Archived from the original on 26 June 2019. Retrieved 18 January 2023.
- ^ a b . London: BBC. BBC News. 26 June 2019. Archived from the original on 2 July 2019. Retrieved 12 December 2022.
- ^ Dzirutwe, MacDonald; Elgood, Giles (29 March 2020). . Reuters. London: Thomson Reuters. Archived from the original on 31 March 2020. Retrieved 18 January 2023.
- ^ Muronzi, Chris (30 October 2019). . Al Jazeera English. Doha: Al Jazeera Media Network. Archived from the original on 30 October 2019. Retrieved 18 January 2023.
- ^ a b Mangudya, John Panonetsa (4 November 2019). (PDF). Reserve Bank of Zimbabwe. Harare. Archived from the original (PDF) on 13 December 2022. Retrieved 13 December 2022.
- ^ a b Marawanyika, Godfrey (12 November 2019). . New York City: Bloomberg. Bloomberg News. Archived from the original on 18 December 2019. Retrieved 10 December 2022.
- ^ a b Mangudya, John Panonetsa (22 July 2022). (PDF). Reserve Bank of Zimbabwe. Harare. p. 140. Archived from the original (PDF) on 10 December 2022. Retrieved 10 December 2022.
- ^ Muronzi, Chris (5 May 2022). . Al Jazeera English. Doha: Al Jazeera Media Network. Archived from the original on 18 January 2023. Retrieved 18 January 2023.
- ^ Latham, Brian (4 June 2019). . New York City: Bloomberg. Bloomberg News. Archived from the original on 4 September 2019. Retrieved 12 December 2022.
- ^ . NewsDay Zimbabwe. Harare: Alpha Media Holdings. 12 June 2019. Archived from the original on 13 June 2019. Retrieved 12 December 2022.
- ^ Stoddard, Ed (1 July 2019). . Daily Maverick. Johannesburg: Styli Charalambous. Archived from the original on 3 July 2019. Retrieved 12 December 2022.
- ^ a b . Reserve Bank of Zimbabwe. Harare. December 2022. table "CPI 1". Archived from the original (XLS) on 18 January 2023. Retrieved 18 January 2023.
- ^ "Zimbabwe shifts to new 'blended' inflation that includes USD, ZWL prices. Not a good idea, says business". newZWire. 3 March 2023. Retrieved 20 May 2023.
- ^ "Blended inflation blurring actual Zim dollar inflation". eBusiness Weekly. 27 April 2023. Retrieved 20 May 2023.
- ^ Machivenyika, Farirai (24 March 2014). . The Chronicle. Bulawayo: Zimpapers. Archived from the original on 27 August 2017. Retrieved 28 December 2022.
- ^ (PDF). Reserve Bank of Zimbabwe. Harare. 5 April 2022. Archived from the original (PDF) on 11 December 2022. Retrieved 11 December 2022.
- ^ Shaban, Abdur Rahman Alfa (3 February 2017). . Africanews. Pointe-Noire: Euronews. Reuters. Archived from the original on 6 April 2017. Retrieved 11 December 2022.
- ^ Linzmayer 2019, pp. 25–27
- ^ Madzianike, Nyore (20 May 2020). . The Herald. Harare: Zimpapers. Archived from the original on 26 May 2020. Retrieved 18 January 2023.
- ^ Vinga, Alois (6 July 2021). . New Zimbabwe. Destiny Media Group. Archived from the original on 10 December 2022. Retrieved 10 December 2022.
- ^ Linzmayer, Owen (9 December 2019). . Banknote News. Virginia Beach. Archived from the original on 28 December 2022. Retrieved 28 December 2022.
- ^ Linzmayer, Owen (4 January 2020). . Banknote News. Virginia Beach. Archived from the original on 28 December 2022. Retrieved 28 December 2022.
- ^ a b (PDF). Reserve Bank of Zimbabwe. Harare. 15 May 2020. Archived from the original (PDF) on 10 December 2022. Retrieved 10 December 2022.
- ^ (PDF). Reserve Bank of Zimbabwe. Harare. 6 July 2021. Archived from the original (PDF) on 6 July 2021. Retrieved 10 December 2022.
- ^ (PDF). Reserve Bank of Zimbabwe. Harare. 9 April 2022. Archived from the original (PDF) on 10 December 2022. Retrieved 10 December 2022.
- ^ Hungwe, Brian (6 February 2014). "Zimbabwe's multi-currency confusion". BBC News Online. Retrieved 5 September 2016.
- ^ "Zimbabwe to start phasing out use of US dollars at the end of 2022". Polity. Creamer Media. 16 April 2020. from the original on 19 April 2020.
- ^ a b Ndlovu, Ray (14 July 2020). "Zimbabwe Steps Closer to Hyperinflation With 737.3% Annual Rate". Bloomberg. from the original on 14 July 2020.
- ^ Stoddard, Ed (30 March 2020). "Zimbabwe brings back US dollar peg for fictional currency". The Daily Maverick. from the original on 31 March 2020.
- ^ "Zimbabwe's worst economic crisis in more than a decade". The Economist. 11 July 2020.
- ^ . The Reserve Bank of Zimbabwe. Archived from the original on 23 September 2020.
{{cite web}}: CS1 maint: unfit URL (link) - ^ "Zimbabwe's RTGS dollars explained | IOL Business Report". www.iol.co.za. Retrieved 6 May 2019.
- ^ "Zimdollar moves towards stability". Herald. 19 August 2020. from the original on 20 August 2020.
- ^ a b Moyo, Jeffrey (12 May 2022). "Behind Zimbabwe's Currency Woes". Friedrich-Naumann-Stiftung für die Freiheit (Friedrich-Naumann Foundation). from the original on 13 May 2022.
- ^ a b "Press Statement: Introduction of Gold Coins" (PDF). The Reserve Bank of Zimbabwe. 4 July 2022. (PDF) from the original on 10 July 2022.
- ^ Ndlovu, Ray (22 July 2022). . Bloomberg. Archived from the original on 23 July 2022. Retrieved 24 July 2022.
{{cite news}}: CS1 maint: bot: original URL status unknown (link)
External links edit
- Reserve Bank of Zimbabwe Website
- February 2019 Monetary Policy
| Preceded by: Multi-currency system Reason: de-dollarisation | Currency of Zimbabwe 25 February 2019 – Note: foreign currencies were banned from 24 June 2019 to 29 March 2020 | Succeeded by: Current |
| Preceded by: Zimbabwean bonds (Zimbabwean bond notes and Zimbabwean bond coins) Ratio: at par |