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Cash shortages and currency uncertainties have taken a turn for the worse in Zimbabwe, as a combination of unfavourable elements and panicking individuals have seen grocery prices skyrocket in the past week.
In a move reminiscent of the 2008 hyperinflation era, prices of several basic products have doubled or tripled in the past few days as panic griped Zimbabweans trying to exhaust their bank balances before they completely lost value.
Currency rates on the black market have also skyrocketed, with $100 now selling for $150 or more for an electronic transfer.
Social media has been relaying information, warning individuals to stock up amid rumours that the country will soon run out of basic commodities.
Some supermarkets have responded by restricting certain basic products to one per customer.
The Reserve Bank of Zimbabwe (RBZ) has however issued a statement dismissing the social media reports.
“The Reserve Bank of Zimbabwe would like to advise the Zimbabwean public to dismiss the social media messages that are circulating and suggesting that there is going to be a shortage of basic commodities.
“These messages are meant to cause panic and despondency and mayhem to the unsuspecting and peace-loving members of the public. All such and other statements should be dismissed with the contempt they deserve,” read a recent RBZ statement.
The RBZ said peddling of such fake news is quite unfortunate, as there are no shortages of basic commodities.
“On the contrary, foreign exchange currently being allocated for basic and essential commodities has instead been increased to ensure that shortages of commodities do not occur within the economy.
“Zimbabweans should refuse to be hoodwinked by fake social media statements designed to increase premiums on the parallel markets by misguided rent seekers,” said the statement, signed off by the RBZ governor Dr John Mangudya.
“In addition, the Minister of Finance and Economic Development did not print bond notes to buy US dollars from the streets.
“Such malicious statements are counterproductive and are meant to sabotage the economy that is on the rebound on account of the good agricultural outturn, strong performance of the mining sector and the recovery of the manufacturing sector.”
Reserve Bank ‘in denial’
Zimbabweans have however said Mangudya is in denial, instead of accepting the reality that he has failed and must resign as per his promise when he introduced bond notes.
Some observers however blame the country’s treasury for borrowing extensively on the local market, and in the process creating increased demand for cash both for local and foreign transactions.
The country’s government used treasury bills to fund a successful agricultural season, but providers of inputs have now turned to local banks to cash in on the TBs putting increased pressure on the demand for cash.Source: Fin 24