The currency gained 0.2% to 13.53 per US dollar, according to data on the Reserve Bank of Zimbabwe’s website on Tuesday. But the rand was trading at R18.47 to the dollar by 12:20 on Tuesday.
The ZiG, short for Zimbabwe Gold, was started on Monday. This is Zimbabwe’s sixth attempt to make its own money again. The last money, the Zimbabwe dollar, lost value every single day this year before they stopped using it on April 5.
The ZiG started trading on Monday. The Reserve Bank Governor, John Mushayavanhu, set the starting exchange rate at 13.56 per US dollar for the ZiG.
He said the exchange rate will be decided in the interbank market from now on.
This is the sixth time they’re trying to make a local currency. The other tries failed because the government printed too much money.
Even though Mushayavanhu says they won’t print too much money this time, it will be hard to get people to use the new money. People have seen their money lose value many times before.
The government also didn’t help because they said people have to pay for things like road toll fees and passports in US dollars.
Peter C. Earle, an economist, doesn’t think the ZiG will work either. He said the government has always printed too much money, and they might do it again.
Over the weekend, banks, shops, phone companies, and other businesses changed their systems to use the new money. But it might take a few days before everything works right. Only US dollar transactions weren’t affected by the change.
A few banks started using the ZiG on Monday, but bigger banks will start later, according to Lawrence Nyazema, president of the Bankers Association of Zimbabwe.
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The stock market also changed to use the new money. All the prices and reports will now be in ZiG.
The stock market in Harare has gone up a lot this year. But that usually means prices are going up too fast, and people are trying to keep their money safe.
Most people didn’t do much trading on Monday. They’re waiting to see what happens with the new money.
The new money will also make things hard for companies when they make their financial reports, according to Lloyd Mlotshwa, from a brokerage firm in Harare.
Before they stopped using the Zimbabwe dollar, it was getting worse every day. People had to use more and more money to buy things.
Now, they have a new money called ZiG. But even before they started using ZiG, people stopped using the Zimbabwe dollar. And now, there’s no money trading on the side, which is usually how people get more money than the official rate.
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