LATEST: RBZ devalues ZiG by over 40 percent
ccording to the central bank website Friday, the mid-rate was now US$1: 24.3902.
By Staff Reporter
The Reserve Bank of Zimbabwe (RBZ) has all but devalued the ZiG by nearly 40 percent in an indirect admission the local currency could not withstand inflationary pressures in a country heavily reliant on foreign currency transactions.
According to the central bank website Friday, the mid-rate was now US$1: 24.3902.
On Thursday, only a day before, the official rate was US$1:13.9987.
This represents a massive 42,6 percent fall of the gold backed local currency, based on independent media calculations on Friday.
The central bank however did not announce if it would, henceforth, allow the local unit to trade freely or it shall remain shackled within authority control.
The much-despised local currency, now trading at a hovering US$1:35 on the parallel market, was introduced in April this year by central bank governor John Mushayavanhu amid praise and optimism by Zimbabwean authorities.
But a combination of citizen mistrust and government’s determination to peg some of its services in foreign currency has seen the demand for foreign currency remain high, creating the need for locals to hunt for forex through unofficial channels.
Upon its introduction, government introduced a crackdown on foreign currency dealers it accused of sabotaging the economy through running an exchange rate parallel to the official one.
Equally, government continues to issue threats against businesses it accuses of economic sabotage after pegging their goods and services against the black-market rate.
Lately, the Zimbabwe Revenue Authority opened a channel to allow locals to anonymously report businesses that peg goods using the parallel market rate.
