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Zimbabwe’s Central Bank Rules Out Return to Dollarization

  • Most deposits are in local currency, central bank says
  • State workers, bank employees have requested U.S. dollar wages
John Mangudya
John MangudyaPhotographer: Christopher Goodney/Bloomberg

Zimbabwe’s central bank has ruled out a return to using the U.S. dollar as official currency because there’s not enough greenbacks in the country.

The financial system is still dominated by the local unit, Governor John Mangudya said in a monetary policy statement released Monday. The Zimbabwean dollar, reintroduced three years ago, accounts for 56% of bank deposits with the balance made up of foreign currency, “which shows that there is no sufficient foreign currency liquidity to support dollarization in Zimbabwe,” he said.