The national bank of Zimbabwe has announced that smaller-denomination gold coins would soon be accessible.
People were hurrying to exchange their Zimbabwean dollars for US dollars because of the skyrocketing inflation to prevent their savings from losing value.
As a result, there was a shortage of US cash, which increased exchange rates. The central bank responded by stopping loans.
To reduce the demand for US dollars, it quickly shifted course and released gold coins worth $1,800 last month in their place.
These more expensive gold coins can be purchased at authorized banks and are exchangeable locally.
An average civil servant in Zimbabwe earns $2,600 per year, and since the introduction of the gold coins last month, 4,475 of them have been sold, according to the state-affiliated newspaper Herald.
Thus, in the view of the central bank, it is a success.
According to The Herald, the 180 US dollar gold coins with a reduced value will be distributed in November.
Zimbabwe’s economic problems today are not as severe as they were in the early 2000s, when hyperinflation hit record highs and local currency was completely abandoned.
Furthermore, the nation hasn’t completely recovered from 2008, when the collapse of the Zimbabwean dollar wiped out the pensions and savings of a large number of common people.
However, despite pledging to transform Zimbabwe into what the World Bank refers to as a “middle income country” by 2030, President Emmerson Mnangagwa, who took over for Robert Mugabe after the latter was overthrown by the military in 2017, has been unable to resuscitate the country’s economy.
The US dollar and the Zimbabwe dollar are still the country’s two main currencies, and most Zimbabweans prefer to swap their local money for foreign cash to preserve its purchasing power.
The local currency fell in value from Z$108.66 to US$1 at the beginning of the year to Z$481.85 to US$1 in August as a result of the year’s highest inflation rate of 256% in July.
The coins have gotten a variety of responses. Many Zimbabwean workers won’t be able to afford them, according to some, while others claim they are beneficial for businesses looking to keep their money’s worth.
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