Zimbabwe Bond Notes to Remain Legal Tender Until April 30: Introduction of Zimbabwe Gold (ZiG) Notes and Coins on the Horizon
The Reserve Bank of Zimbabwe (RBZ) has announced that the Zimbabwe bond notes will remain legal tender for domestic transactions until April 30, when the highly anticipated new currency Zimbabwe Gold (ZiG) will be introduced.
Also Read: From ZWL to ZiG: Zimbabwe Announces New Gold-Backed Currency – Here Is What You Need To Know
RBZ Governor’s Clarification: Bond Notes Remain Legal Tender Until April 30, 2024
The announcement of the new currency last Friday initially caused disruptions as some traders, transporters, and members of the public refused to accept Zimbabwe dollar notes.
However, RBZ Governor, Dr. John Mushayavanhu, has clarified that until April 30, 2024, the current bond notes remain legal tender. Banks are authorized to distribute them to customers, ensuring their usability for transactions and providing change. The new currency will be introduced only after the transitional period ends.
“Between now and April 30, 2024, the bond notes are still legal tender; banks can pay them out to customers, and people should be able to use those to transact and for change,” Governor Dr. John Mushayavanhu.
Extensive Educational Campaign Planned: RBZ Prepares Public for the Structure and Security Features of ZiG Notes and Coins
Dr. John Mushayavanhu, assured the public that a 21-day transitional period would be implemented. During this period, the bank will conduct an extensive educational and awareness campaign to familiarize the public with the structure and security features of the ZiG notes and coins before their release.
Stability and Appreciation: RBZ Governor Expresses Confidence in the ZiG Currency
The RBZ Governor expressed confidence in the stability of the ZiG, noting its appreciation in value since its introduction on Friday. The new currency has gained 0.2 percent against the US dollar during Monday and Tuesday’s trading sessions on the interbank market.
To maintain the value of the ZiG, the RBZ has implemented measures such as maintaining a tight monetary policy stance, floating the exchange rate, and occasionally intervening to support the currency. Additionally, the new currency is anchored on precious metals, primarily gold, and foreign exchange. The RBZ holds reserve assets of US$100 million in cash and 2,522 kg of gold worth US$185 million to back the local currency component of reserve money.
Reversing Dollarization Trend: RBZ’s Measures to Promote Increased Demand for ZiG Currency
The Governor acknowledged that the process of reversing the dollarization trend, where 80 percent of transactions in the economy are conducted in US dollars compared to 20 percent in the local currency, will be gradual. However, through the Monetary Policy Statement (MPS) measures and the introduction of the ZiG, the RBZ aims to create increased demand for the new currency. One of the measures to promote the ZiG includes requiring that 50 percent of quarterly payment dates (QPDs) tax obligations be payable in the new currency.
Dr. Mushayavanhu anticipates a surge in demand for ZiG as the June QPD approaches, considering that the current market supply of the new currency is insufficient to meet 50 percent of payment obligations.
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The post Zimbabwe Bond Notes to Remain Legal Tender Until April 30: RBZ Governor Affirms appeared first on iHarare News.
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