Harare, (New Ziana) – The Reserve Bank of Zimbabwe (RBZ) said on Thursday about $1.1 billion in cash was in circulation at the end of December 2019, about $2 billion short of the target it aims to have in the market.
Zimbabweans are still battling cash shortages even after the re-introduction of a local currency last year.
Hopes were high that bank note shortages, which have persisted for up to five years, would be a thing of the past with the country having its own currency.
But long queues are still a feature at banking institutions as depositors, who include pensioners, still battle to get access to the little available cash.
The bulk of the cash is still being found and sold in the streets, at premiums of up to 30 percent.
The central bank has said it will drip feed cash into the market to avoid fueling inflation, but impatient citizens want the shortages addressed as soon as yesterday.
The RBZ’s Monetary Policy Committee said the apex bank had imported $400 million in notes and coins in the last quarter of 2019, but noted the amount still remained far off the target that should be in circulation.
“This ZW$1.1 billion of notes and coins in circulation, represents 3.2 percent of total banking sector deposits of ZW$34.5 billion as at 31
December 2019,” the MPC said after its meeting on Wednesday.
“The MPC agreed that it should maintain its plan of getting the proportion of bank notes and coins in circulation up to 10 percent of deposits and that the Bank should consider the introduction of notes in larger denominations in line with inflation trends.”
With a $5 note being the biggest denomination in circulation, the government has promised to introduce $10, $20, $50 and $100 notes over time in a restrained manner that would not fuel inflation.
In line with the central bank’s target, at least $3.4 billion in cash and coins should be in circulation at the moment.