Harare’s New Scheme to Curb an Economic Collapse

Zimbabwe is set to introduce gold coins that will enable investors to store value within the country as inflation spirals out of control and the local currency continues to rapidly devalue against major currencies. In a statement on Monday, the southern African country’s central bank chief John Mangudya announced the new gold coins would be available through normal banking institutions. The move comes after inflation for June jumped to 191.6% from 132% in May. The central bank’s monetary policy committee expressed “great concern on the recent rise in inflation”, which increased by 30.7% on a month-on-month basis for June 2022. As part of measures to stabilise the economy, the central bank will more than triple the lending rate from 80 percent to 200 percent per annum and raise the interest rate from 50 percent to 100 percent per annum. The country’s inflation has been on an upward trend in the past three months as inflation pressures rise, driven by the continued weakening of the Zimbabwean dollar which is trading at $1:650 on the black market.

SOURCE: AL JAZEERA