#jaiyeorie
In order to combat hyperinflation, Zimbabwe's central bank increased its benchmark interest rate by more than 200 percent on Monday, making it the highest rate in the world.
Fears of a return to the hyperinflationary period of 2008, when savings were completely wiped out, increased when annual inflation more than doubled in just two months to hit 191 percent in June.
After expressing "grave concern" about the recent spike in inflation, the bank's governing body made the astronomical interest rate increase public in a statement.
“The committee noted that the increase in inflation was undermining consumer demand and confidence and that, if not controlled, it would reverse the significant economic gains achieved over the past two years,” bank governor John Mangudya said.
The benchmark interest rate last increased from 60 percent to 80 percent in April.As gasoline and food prices have risen in the wake of Russia's invasion of Ukraine and supply chain disruptions, central banks throughout the world have begun raising rates to combat inflation.
Zimbabwe is experiencing a severe economic downturn.
The local currency has also had significant setbacks; Bloomberg reports that it has lost more than two thirds of its value this year alone, making it one of the continent's poorest performing currencies.
Price increases bring up painful memories of the Z$100 trillion note that the central bank created in 2008 during a period of extreme hyperinflation that is now prized by collectors.
✍️✍️✍️ ✍️“feel free to disagree in the comments 👀 ☝️👆 & let JAIYEORIE know what U think!” 📎 COMMENTS 👈👉✍️🤳 DROP YOUR OPINIONS ✍️✍️✍️
0 Comments