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Zimbabwe Central Bank says usage of ZiG has doubled
31 Jul 2024 at 07:07hrs | Views
The use of Zimbabwe's bullion-backed currency has doubled since it was launched in early April, central bank Governor John Mushayavanhu told the country's Sunday Mail newspaper.
The ZiG is now used in 30% of all transactions, compared with 15% on April 5, with the balance being done in dollars, he was quoted as saying. "There was no upsurge in foreign currency demand, rather there was a shift in product pricing ratio, with the ZiG now accounting for 30% of all transactions," Mushayavanhu told the Harare-based weekly newspaper.
In a July 15 interview with Bloomberg, he said ZiG usage had risen to 20% of transactions from 15%.
The ZiG, short for Zimbabwe Gold, replaced the Zimbabwean dollar after it collapsed in value against the greenback. It's the southern African nation's sixth attempt at having a functioning local currency in the last 15 years and is backed by foreign currency reserves as well as the precious metal.
Zimbabwean Finance Minister Mthuli Ncube last week announced measures to spur demand for ZiGs, including ordering government departments to accept payment in the local currency instead of dollars and increased the amount of taxes payable in the unit.
The country has set 2030 as the date for the ZiG to become sole legal tender, while President Emmerson Mnangagwa has hinted that it could be as early as 2026.
The ZiG traded at 13.79 to the US dollar on Monday, according to data posted on the central bank's website. The bank injected $50 million into the market on Friday to support the ZiG amid a surge in dollar demand among lenders.
The ZiG is now used in 30% of all transactions, compared with 15% on April 5, with the balance being done in dollars, he was quoted as saying. "There was no upsurge in foreign currency demand, rather there was a shift in product pricing ratio, with the ZiG now accounting for 30% of all transactions," Mushayavanhu told the Harare-based weekly newspaper.
In a July 15 interview with Bloomberg, he said ZiG usage had risen to 20% of transactions from 15%.
The ZiG, short for Zimbabwe Gold, replaced the Zimbabwean dollar after it collapsed in value against the greenback. It's the southern African nation's sixth attempt at having a functioning local currency in the last 15 years and is backed by foreign currency reserves as well as the precious metal.
Zimbabwean Finance Minister Mthuli Ncube last week announced measures to spur demand for ZiGs, including ordering government departments to accept payment in the local currency instead of dollars and increased the amount of taxes payable in the unit.
The country has set 2030 as the date for the ZiG to become sole legal tender, while President Emmerson Mnangagwa has hinted that it could be as early as 2026.
The ZiG traded at 13.79 to the US dollar on Monday, according to data posted on the central bank's website. The bank injected $50 million into the market on Friday to support the ZiG amid a surge in dollar demand among lenders.
Source - Bloomberg
