/ 14 August 2001

INFLATION DRIVES ZIM TO ISSUE 500 DOLLAR NOTE

ZIMBABWE will late this month introduce a 500 dollar banknote (worth about nine US) due to rising inflation which has eroded the value of the currency. The largest denomination note available so far had been a 100 dollar (1.81 US) note, which was introduced in 1995. “In view of rising inflation, the 500-dollar note is being introduced for the handling convenience of the transacting public,” Reserve Bank governor Leornard Tsumba said. He said “very high” inflation over the past decade had significantly eroded the value of money in circulation, with a Zimbabwe dollar in 1990 now worth only six cents. The governor said inflation had quadrupled between 1990 and 2001. “The 500-dollar note is now being introduced to solve the portability problem,” he said. The inflation rate shot to 64,4% in June this year, and economists forecast it could easily hit the 100% mark by the end of the year. – AFP