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Encyclopedia > Zimbabwean dollar
Zimbabwean dollar
Old $500 banknote that is now worthless
ISO 4217 Code ZWD (initially ZWN)
User(s) Zimbabwe
Inflation est. 9,000% (June 2007)
Source [http://www.cnn.com/2007/WORLD/africa/06/21/zimbabwe.ap/index.html?section=cnn_latest
Symbol $
Coins None
Banknotes (bearer cheques) 1, 5, 10, 50 cents, $1, $10, $20, $50, $100, $500, $1000, $5000, $10 000, $50 000, $100 000
Central bank Reserve Bank of Zimbabwe
Website www.rbz.co.zw

The revalued Zimbabwean dollar (currency code ZWD) has been the currency of Zimbabwe since August 2006, when it replaced the old Zimbabwean dollar (ZWD) at a rate of 1,000 old ZWD = 1 ZWD (revalued). The ISO originally assigned a new currency code of 'ZWN' to this redenominated currency, but the Reserve Bank of Zimbabwe could not deal with a currency change. Therefore the currency code remains 'ZWD'. Image File history File links 500_Zimbabwean_dollar_note. ... $ The dollar sign ($) is a symbol primarily used to indicate a unit of currency. ... The banknotes of Zimbabwe were first issued in 1980 after the colony of Rhodesia became independent within the Commonwealth of Nations as the Republic of Zimbabwe. ... Reserve Bank of Zimbabwe is that southern African countrys central bank. ...


It is normally abbreviated with the dollar sign $, or alternatively Z$ to distinguish it from other dollar-denominated currencies. It is divided into 100 cents. $ The dollar sign ($) is a symbol primarily used to indicate a unit of currency. ... United States one-dollar bill Canadian one-dollar coin (Loonie) One New Taiwan dollar Australian one-dollar coin 500 old Zimbabwean dollars The dollar (often represented by the dollar sign: $) is the name of the official currency in several countries, dependencies and other regions. ... A two-cent euro coin A United States penny, or 1¢ In currency, the cent is a monetary unit that equals 1/100 of the basic unit of value. ...


Thirteen new bearer cheques were released on 1 August 2006 in denominations from 1 revalued cent to $100,000 (revalued). August 1 is the 213th day of the year (214th in leap years) in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ...

Contents

History

The old Zimbabwean dollar replaced the Rhodesian dollar at par, which in turn had been adopted in 1970 as a decimalisation replacement of the Rhodesian pound at a rate of 2 Rhodesian dollars to 1 Rhodesian pound (R$ 0.71 = US$ 1.00). At the time of independence in 1980, one Zimbabwean dollar was still worth more than the US dollar (ZWD 0.68 = USD 1.00), but the currency's value has eroded rapidly over the years. On 26 July 2006 the parallel market value of the Zimbabwean dollar fell to one million to the British pound. [1] The Rhodesian Dollar was the currency used by Rhodesia between 1970 and 1980. ... Par value has several meanings depending on the context, whether used in the equities market, or in the bond markets, and partially also dependent on where in the world the par value term is used. ... In the management of currencies, decimalisation (or decimalization) is the process of converting from traditional denominations to a decimal system, usually with two units differing by a factor of one hundred. ... The pound was the currency of Southern Rhodesia, then Rhodesia and Nyasaland and finally Rhodesia from 1932 until 1970. ... July 26 is the 207th day of the year (208th in leap years) in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ...


The Zimbabwean dollar was redenominated on 1 August 2006 at the rate of 1 revalued dollar = 1000 old dollars. The subunit is still cent, 1/100 of a revalued dollar, though in practice cents are not used. Also on 1 August 2006 the Government of Zimbabwe devalued the Zimbabwean dollar by 60% vs. the US dollar (see exchange rate history table below), from 101,000 old dollars (101 revalued) to 250 revalued dollars. August 1 is the 213th day of the year (214th in leap years) in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ... August 1 is the 213th day of the year (214th in leap years) in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ...


Inflation

v  d  e
Zimbabwean inflation rates since independence
Date Rate Date Rate Date Rate Date Rate Date Rate Date Rate
1980 7% 1981 14% 1982 15% 1983 19% 1984 10% 1985 10%
1986 15% 1987 10% 1988 8% 1989 14% 1990 17% 1991 48%
1992 40% 1993 20% 1994 25% 1995 28% 1996 16% 1997 20%
1998 48% 1999 58% 2000 56% 2001 132% 2002 139% 2003 385%
2004 624% 2005 586% 2006 1281% 2007 4530%

Rampant inflation and the collapse of the economy have severely devalued the currency, with many organisations using the US dollar, the euro, the pound sterling, or the South African rand instead. The United States dollar is the official currency of the United States. ... “EUR” redirects here. ... ISO 4217 Code GBP User(s) United Kingdom, Crown Dependencies Inflation 2. ... ISO 4217 Code ZAR User(s) Common Monetary Area: Lesotho, Namibia, South Africa, and Swaziland Inflation 5. ...


Early in the 21st century Zimbabwe started to experience hyperinflation. Inflation reached 624% in early 2004, then fell back to low triple digits before surging to 1,281.1% in December 2006. [2] Certain figures in this article use scientific notation for readability. ...


If policies do not change, the IMF has predicted an inflation rate of over 5,000% for the year 2007. [3] and 6,400% for 2008 [4]


The year 2007 has started badly as inflation reached another record high of 3714% (year-on-year) in April. [5] The monthly rate for April exceeded 100%, implying that inflation may soon exceed all forecasts, as 100% monthly inflation over sustained 12 months would produce annual inflation of over 400,000%. Mid year inflation has been breaching records as inflation for May was estimated at 4,530% (year-on-year).[6]


Money supply

On 16 February 2006, the governor of the Reserve Bank of Zimbabwe, Dr Gideon Gono, announced that the government had printed ZWD 20.5 trillion in order to buy foreign currency to pay off IMF arrears.[7] February 16 is the 47th day of the year in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ... This article needs additional references or sources to facilitate its verification. ...


In early May 2006, Zimbabwe's government announced that they would produce another 60 trillion Zimbabwean dollars. [8]


The additional currency was required to finance the recent 300% salary increase for soldiers and policemen and 200% increase for other civil servants. The money was not budgeted for the current fiscal year, and the government did not say where it would come from. On May 29, Reserve Bank officials told IRIN that plans to print about Zim$60 trillion (about US$592.9 million at official rates) were briefly delayed after the government failed to secure foreign currency to buy ink and special paper for printing money.


In late August 2006, it was reported that about ten trillion old dollars (22% of the money supply) had not been exchanged for revalued dollars. These bearer cheques were demonetized.


Exchange rate history

This table shows a condensed history of the foreign exchange rate:

Year 1983 1997 2000 2002 (Jun) 2005 (Mar) 2006 (Jan) 2006 (July)
ZWD per 1 USD 1 10 100 1,000 10,000 100,000 500,000+
Year 2006 (Aug) 2006 (Sept) 2006 (Dec) 2007 (Jan) 2007 (Feb) 2007 (Mar) 2007 (Apr) 2007 (May) 2007 (June)
Revalued ZWD
per 1 USD
650(000) 1,000 3,000 4,800 7,500 26,000 35,000 50,000 300,000

This table shows in more detail the historical value of one U.S. dollar in Zimbabwean dollars:

Date Official Rate Free / Parallel Rate Notes
1978 R$0.6788 (Apr) n/a R$ pegged to US$
1980 R$0.68 (Mar) n/a R$ tied to basket of FFR, DEM, ZAR, CHF, GBP, USD
April - Independence (1 Z$ = 1 R$)
1982 0.8925 to 0.9140 (Dec) - ZWD devalued by 16.5%
1983 0.96135 (Jan) up to 3.18 (July) ZWD devalued by 5%
Parallel rate highly variable - premium up to 231%
1983 (Aug) to 1993 (Dec) 0.96135 - 6.82 Flexible basket; dual rates; 20% tax on outgoing payments
1994 6.82 (Jan) 8.36 (Oct) Floating official rate (July 1) ; dual rates; ZWD devalued by 17%
1995 8.26 (Jan) 8.85 (Oct) floating official rate; dual rates; rates unified 1998 (Dec)
1996 9.13 (Jan) 10.52 (Oct)
1997 10.50 (Jan) 12.00 (Jan); 25.00 (Nov)
1998 18.00 (Jan) 16.65 (Jun); 19.00 (Jul); 23.50
1999 36.23 (Jan) 38.30 (Sep) On 1999 March 31, the Official Exchange Rate was pegged at ZWD 38 per USD; By 1999 (Dec) the parallel market had re-emerged.
2000 38 to 55 56 to 62 (Jul); 65 to 70 (Aug.) In Aug 2000, the Official Exchange Rate was pegged at ZWD 50 , then ZWD 51 and finally at ZWD 55 per USD; Parallel black market rates were at a large premium; In Nov. foreign exchange bureaux were closed.
2001 55 70 (Jan); 80 (Feb); 100 (Mar); 120 (Apr); 140 (May); 160 (Jun); 250 (Jul); 300 (Aug); 400 (Sep); 300 (Oct); 320 (Nov); 340 (Dec) In June, the official rate became a crawling peg rate.
2002 55 380 (Jan) to 710 (Jun), 1400 (Jul) to 1740 (Oct) to 1400 (Dec) In 2002 the parallel black market for foreign exchange mushroomed.
2003 55 (Jan); 824 (Feb) 1400 (Jan); 1450 (Feb); 2300 (May); 3000 (Jul); 6000 (Aug); 6400 (Oct); 6000 (Nov) In February 2003, the Official Exchange Rate was re-pegged at ZWD 824 per US $
2004 824 (Jan 1); 4196 (Jan 12) to 5730 (Dec) 5500 (Jan 1) to 6000 (Dec) In January 2004, semi-weekly (RBZ-controlled) currency auctions were set up to determine the official rate.
2005 5,730 (January); 6,200 (March); 9,000 (May); 10,800 (July 18); 17,600 (July 25); 24,500 (August 25); 26,003 (September); 26,003 (October); 60,000 (Nov); 84,588 (Dec 30) 6,400 (January); 14,000 (March); 20,000 (May); 25,000 (July 18); 45,000 (July 25); 45,000 (August 25); 75,000 (September); 80,000 to 100,000 (October); 90,000 (Nov); 96,000 (Dec 30) Aug 24 - Zimbabwean dollar becomes least valued currency unit
In November 2005, the regular currency auctions were discontinued and the RBZ announced that "market factors" would control the exchange rate.
2006 (to July 31) 85,158 (Jan 3); 99,202 (Jan 24); 101,195.54 (Apr 28) (click for details) 100,000 (Jan 6); 106,050 (Jan 19); 115,000 (Jan 20); 125,000 to 150,000 (Jan 25); 175,000 to 190,000 (Feb 24); 205,000 to 220,000 (Mar 03); 220,000 to 230,000 (April 13); 300,000 to 310,000 (May 25); 315,000 (June 09); 340,000 to 350,000 (June 16); 400,000 (June 21); 450,000 (July 01); 520,000 (July 09)[9]; 550,000 (July 27)[10] Economists predict an unofficial rate of nearly ZWD 250,000 to the US dollar by mid-2006.
Jan 24 - RBZ caps daily varience of official exchange rate based on volume traded. The ZWD is able to fluctuate (from its average rate) in a daily band of: 0 % (under USD 5 million); 1 % (USD 5 to 10 million); 1.5 % (USD 10 to 15 million); or 2 % (exceeds USD 15 million). This effectively froze the official exchange rate.
Date Official Rate (Revalued dollar) Free / Parallel Rate (Revalued dollar) Notes
2006 (From Aug 1) 250 (250,000 old) 550 (Aug 01); 650 (Aug 03); 650 to 700 (Aug 24); 700 to 800 (Sep 08 - high volume transactions) [11]; 850 (Sep 14) [12]; 1,200 to 1,300(Sep 28) or 1,500 (Sep 28 - high volume transactions) [13]; 1,500 (Oct 11) [14]; 1,700 (Nov 5) [15]; 2,000 (Nov 18) [16]; 2,400 (Nov 29)[17]; 3,000 (Dec. 24)[18] Aug 1 - RBZ revalues the Zim dollar. 1,000 Old Zim dollars become 1 revalued Zim dollar. The official exchange rate is set to 250 revalued Zim dollars per 1 US dollar. (Parallel rate soars to over 600 revalued dollars per 1 US dollar)
2007 250
(15,000**) special rate
January

3,000 (1st [19]); 3,200 (11th [20]); 3,500 (18th [21]); 4,000 (20th [22]); 4,200 (22nd [23]); 6,000 (26th [24]) It has been suggested that this article or section be merged into underground economy. ... It has been suggested that this article or section be merged into underground economy. ... The least valued currency unit is the currency in which a single unit buys the least number of any given other currency or the smallest amount of a given good. ...

Zimbabwean dollar becomes least valued currency unit around March 21; In March, the parallel rate becomes extremely erratic, with reported rates varying significantly.
** A "special rate" of 15,000 ZWD per USD was brought in on 26 April 2007. The improved exchange rate will be applied to miners, farmers, tour operators, non-governmental organizations, embassies, Zimbabweans living abroad that repatriate earnings, and others who generate foreign exchange. Exporters will be required to exchange money at the central bank to receive the better rate. [25]
February

4,800 (2nd [26]); 5,000 (12th [27]); 6,600 (23rd [28]); 7,000 (26th [29]); 7,500 (28th [30]) The least valued currency unit is the currency in which a single unit buys the least number of any given other currency or the smallest amount of a given good. ...

March

8,000 (1st [31]); 10,000 (8th [32]); 11,000 (11th [33]); 12,000 - 17,500 (16th [34]); 16,000 (19th [35]); 20,000 (21st [36]); 24,000 (22nd [37]); 25,000 (26th [38]); 26,000 (29th [39])

April

30,000 (1st [40]); 15,000 (6th [41]); 20,000 (8th [42]); 25,000 (11th [43]); 35,000 (15th [44])

May

28,000 (10th [45]); 32,000 (17th [46]); 38,000 (18th [47]); 40,000 (22nd [48]); 45,000 (23rd [49]); 50,000 (29th [50])

June

55,000 (2nd [51]); 60,000 (12th [52]); 75-100,000 (13th [53]); 120,000 (15th [54]); 205,000 (19th [55]); 300,000 (21st [56])

Coins

Coins were issued since 1980 in denominations of ½, 1, 5, 10, 20, and 50 cents as well as ZWD 1, 2, and 5. (click for image) They remain legal tender, but, due to their minuscule value, they function as gambling tokens in Zimbabwean casinos. This article is about monetary coins. ... Casinos can refer to: the plural of Casino Casinos, Valencia, a municipality in Spain Category: ...


Plans, by the Reserve Bank of Zimbabwe, for new Z$5,000 and Z$10,000 coins were announced in June 2005 (click for story). They never appeared, victims of hyperinflation.


Banknotes, traveller's cheques and bearer cheques

The banknotes of Zimbabwe were first issued in 1980 after the colony of Rhodesia became independent within the Commonwealth of Nations as the Republic of Zimbabwe. ...

New currency (2005-6), revaluation (2006), new currency (2007)

In October 2005, the head of the Reserve Bank of Zimbabwe, Dr. Gideon Gono, announced "Zimbabwe will have a new currency next year." New banknotes and coins were to replace the then current Zimbabwean dollar. Gono did not provide a name for this new currency.


In June 2006, Deputy Finance Minister David Chapfika stated that Zimbabwe had to achieve macroeconomic stability (i.e., double digit inflation) before any new currency was introduced.


On 31 July 2006, the Reserve Bank of Zimbabwe revalued the Zimbabwe dollar by one thousand to one. Thirteen new bearer cheques were issued and people were only given 21 days to exchange the old bearer cheques. July 31 is the 212th day of the year (213th in leap years) in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ...


At the same time, the Zimbabwean dollar was devalued by 60% and the new exchange rate set at 250 revalued dollars per 1 U.S. dollar.


The problem-ridden revaluation campaign, which Gideon Gono named "Operation Sunrise" was completed on 21 August 2006. It was estimated that some ten trillion old Zimbabwe dollars (22% of the money supply) were not redeemed during this period (a nice windfall for the RBZ)[57]. August 21 is the 233rd day of the year (234th in leap years) in the Gregorian calendar. ... For the Manfred Mann album, see 2006 (album). ...


Other problems included, but were not limited to:

  • behaviour by police/youth militias who set up roadblocks and seized currency beyond the daily deposit limits;
  • invasions of businesses and homes to seize cash;
  • shortages of the new bearer cheques (even at banks);
  • refusal of many businesses and people to accept the old bearer cheques;
  • chronic shortages of "small" bills to make change; and
  • the rapidity of the change over, particularly for people in remote, rural towns where information on the changes was received too late to exchange their bearer cheques.

Most economists have blasted the move as merely political. They claim that without drastic changes in the policies of the RBZ, the zeroes will come back rapidly.


As people panicked to dump their old cash, the revaluation process drove up prices on the Zimbabwean Stock Exchange to levels that, while still below the 1,000% inflation, are the highest returns of any market in the world.


On December 12, 2006, Dr. Gono hinted in a memorandum to banks and other financial institutions that he would lay out the next phase of his monetary reforms dubbed Project Sunrise Two when he announces the monetary policy review statement in January 2007. It was not possible to get immediate confirmation from Gono's office whether the memorandum was an advise to banks that he would be launching the new currency in January. But the chief executive officer of one of the country's largest banks said industry players had understood the governor's memo to mean new money would be introduced next month. [58] A possible name appears to be "ivhu", which means "soil" in Shona.[59] December 12 is the 346th day (347th in leap years) of the year in the Gregorian calendar, with 19 days remaining. ... For the Manfred Mann album, see 2006 (album). ... Shona (or ChiShona) is a native language of Zimbabwe and southern Zambia; the term is also used to identify those Kintu speaking peoples in Southern Africa who speak one of the Shona languages. ...


On February 2, 2007, it was revealed that a new (third) dollar would be released "soon", in denominations of $1, $5, $10, $20, $100, $500, and $1,000. The $1 bill has an image of the Victoria Falls and a buffalo, the $5 the Kariba dam wall and an elephant, the $10 agricultural activity and a grain silo, the $20 portrait of a mine site and a mine with a jack hammer, $100 the botanic gardens and the Great Zimbabwe conical tower, the $500 a portrait of a dairy farm. No indications of what will be on the $1,000 [60]. However, given that inflation remains in four digits, these banknotes are likely to remain in storage for the foreseeable future. February 2 is the 33rd day of the year in the Gregorian calendar. ... 2007 (MMVII) is the current year, a common year starting on Monday of the Gregorian calendar and the AD/CE era. ...


In February 2007, the central bank of Zimbabwe declared inflation "illegal", outlawing any raise in prices on certain commodities between March 1 and June 30, 2007. Officials have arrested executives of some Zimbabwean companies for increasing prices on their products. Economists generally suspect that such measures will be ineffective at eliminating the problem in the long term. [61] [62] is the 60th day of the year (61st in leap years) in the Gregorian calendar. ... June 30 is the 181st day of the year (182nd in leap years) in the Gregorian calendar. ... 2007 (MMVII) is the current year, a common year starting on Monday of the Gregorian calendar and the AD/CE era. ...


On June 15, 2007, economist Eddie Cross reported that "There is talk that the Reserve Bank will cut another three zeros off our currency next week and this would mean that one Zimbabwe dollar would now equal one million of the "old" dollars. Chaos reins in commerce and industry and those in the public sector are frantic." [63]


See also

The banknotes of Zimbabwe were first issued in 1980 after the colony of Rhodesia became independent within the Commonwealth of Nations as the Republic of Zimbabwe. ... The least valued currency unit is the currency in which a single unit buys the least number of any given other currency or the smallest amount of a given good. ... // Properly managed, Zimbabwes wide range of resources should enable it to support continuing economic growth. ...

External links

Image File history File links No higher resolution available. ...

News

Old dollar
Preceded by:
Rhodesian dollar
Reason: independence recognized
Ratio: at par
Currency of Zimbabwe
1980July 31, 2006
Succeeded by:
Revalued dollar
Reason: inflation
Ratio: 1 revalued dollar = 1000 old dollars
Revalued dollar
Preceded by:
Old dollar
Reason: inflation
Ratio: 1 revalued dollar = 1000 old dollars
Currency of Zimbabwe
August 1, 2006
Succeeded by:
Current

  Results from FactBites:
 
Zimbabwean dollar - Wikipedia, the free encyclopedia (1506 words)
The old Zimbabwean dollar replaced the Rhodesian dollar at par, which in turn had been adopted in 1970 as a decimalisation replacement of the Rhodesian pound at a rate of 2 Rhodesian dollars to 1 Rhodesian pound (R$ 0.71 = US$ 1.00).
On 26 July 2006 the parallel market value of the Zimbabwean dollar fell to one million to the British pound.
The Zimbabwean dollar was redenominated on 1 August 2006 at the rate of 1 revalued dollar = 1000 old dollars.
Breaking News English - Zimbabwe to get new currency (Oct 24, 2005) (2089 words)
Zimbabweans scoff at the present dollar and point out that it is more economical to use the $10 denomination as toilet paper than to buy the real thing.
Zimbabweans scoff at the present dollar and point out that it is more economical to use the $10 denomination as toiletries paper than to buy the real thing.
Zimbabweans _______ at the present dollar and point out that it is more economical to use the $10 denomination as toilet paper than to buy the real thing.
  More results at FactBites »

 
 

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