HARARE – Reserve Bank of Zimbabwe says it will introduce new notes which will be used together with the bond notes in the next two weeks. The introduction coincides with the bond notes three year anniversary. Bond notes were introduced in November 2016 as an export incentive payout method.
RBZ Governor John Mangudya told the inaugural Monetary Policy Committee media briefing that the new currency will come in the form of $2 and $5 notes. The notes will also be introduced together with a $2 bond coin.
The move is part of efforts to curb the high premiums on cash. “The Committee noted that the level of physical cash in the economy is inadequate to meet transactional demand, considering that the current proportion of cash to broad money supply of 4% is low compared to regional and international levels of 10-15%. This low ratio has resulted in an undesirable cash premium which the Committee would like to see eliminated.”
Overall, there would be a gradual increase in cash supply over the next six months.
The committee, which is chaired by Mangudya, also noted the need to review upwards the cash withdrawal limits to ease the burden on the transacting public. This additional cash injection will be carried out through the non-inflationary exchange of RTGS money for physical cash.
MPC members include Dr Kupukile Mlambo and Dr Jesiman Chipika, industrialist and businessman Kumbirai Katsande, ex-Government advisor and economist Professor Ashok Chakravati, former ABC Holdings chief executive Doug Munatsi, economist and former Bulawayo South legislator Eddie Cross, Professor Theresa Moyo and Marjorie Ngwenya.