After defying economic gravity for a year, Zimbabwe’s homemade US dollars have fallen to earth with a bump.
Rumours the central bank was buying up black market US dollars last month with one of its own versions of the currency created panic in a country scarred by the hyperinflationary spiral of 2008 that wiped out people’s savings.
The worthless Zimbabwe dollar was replaced by the US dollar in 2009 but the economy has struggled over the last 18 months because of a massive domestic shortage of greenbacks.
As a result, cash, especially crisp, new, $100 bills, has enjoyed a steady 10 percent to 20 percent premium over dollars stored electronically in bank accounts – nicknamed “zollars”.
But two weeks ago, the rumours that even the central bank had run out of hard currency sent the premium soaring to nearly 50 percent, according to black market traders and unofficial measures of the zollar value.
“I am really scared that I will wake up one day and find my money in the bank is worthless,” said Jethro Nkosi, a computer technician at a hotel in the capital Harare.
The central bank has not published currency reserves since dollarisation and Zimbabweans worry it is creating zollars without the backing of sufficient reserves or gold, leaving the system vulnerable to a crisis of confidence.
Another currency implosion would also be a major headache for 93-year-old President Robert Mugabe as he seeks to extend his 37 years in power in an election in less than a year.
Yesterday, buying $100 in cash via a bank transfer cost 145 electronic zollars, a marginal improvement on 160 last week.
But on Sept. 23, when rumours of the central bank buying black market dollars swept Harare, the rate spiked to 185.
The price of everyday goods has also leapt as importers of food to fuel to medicine are forced to turn to an increasingly unfavourable and risky black market to pay for their wares.
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