Reserve Bank of Zimbabwe (RBZ) governor John Mangudya said that the central bank will continue to inject additional notes and coins on a gradual basis into the economy to ease the ongoing cash shortages.
In his 2019 Mid Term Monetary Policy Statement released on Friday, Mangudya said:
The re-introduction of the local currency and the subsequent withdrawal of the US Dollar as a transactional currency implies that the Bank should issue adequate notes and coins to support economic activity.
The increase in the demand for physical cash has worsened cash shortages, as reflected by unending queues at most banks in the country.
Besides, visitors to the country including tourists are failing to access cash for their domestic transactions, as they are supposed to buy local currency cash from banks or bureaux de change.
Failure to get cash in undermining the confidence in the local currency as well as forcing economic agents to resort to the illegal transactions in foreign currency and to selling cash at a premium.
… Accordingly, without prejudice to our cash-lite society drive which has served the country very well, the Bank will continue to inject additional notes and coins on a gradual basis, to support productive and lessen the inconvenience caused by physical cash shortages to the transacting public.
The cash injections will not increase the money supply as banks will use their existing RTGS balances to exchange for cash.
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