Browsing: Zimbabwe dollar

This shortage of hard currency implies that those businesses that rely on foreign exchange have often had to source it from the parallel market, where it is easily available relative to the formal market.

To mitigate the inflationary pressures caused by businesses looking for foreign exchange on the parallel market and passing on the effect of higher exchange rates to consumers in the form of higher prices, the central bank instituted the foreign currency auction system, which allocates foreign exchange to importers.

This foreign exchange shortage affects all businesses across the economic spectrum and is not limited to retailers only. Manufacturing companies import raw materials and spares. They have recently experienced viability challenges from charging prices in local currency.…

This means that these individuals would not be able to access financial services from the banks for a period of up to two years. The matter is still unfolding, and further developments will be advised in due course.
Zimbabwe, after attaining the highest inflation record in world history and especially for a country that was not involved in an armed conflict, took the decision to demonetize its defunct currency in favour of a basket of foreign currencies led by the United States dollar.
After a period of relative economic stability, the country took the decision to reintroduce the Zimbabwe dollar initially as a surrogate currency known as the Zimbabwe bond note. This was a response by the monetary authorities to a shortage of foreign currency and bank notes. …

• Zimbabwe did not have a parallel market for foreign exchange in the years running from 2009 to around 2016.
• Zimbabwe is heavily reliant on imported products and expends more foreign currency than it can afford.
• Demand pressure has contributed to the fall of the Zimbabwe dollar resulting in general inflation.

This question has robbed monetary authorities of sleep as the Zimbabwe dollar falls precipitously on the parallel market.

Zimbabwe did not have a parallel market for foreign exchange in the years running from 2009 to around 2016.

It all began with the introduction of a surrogate currency that was fallaciously pegged at par with the United States dollar. The authorities initially posited that the surrogate currency was supported by a loan facility extended by the Africa Export-Import Bank (Afrexim Bank).

This loan it was said underscored the parity of the currency. It did not …