Zimbabwe’s ZiG Currency Hits Longest Losing Streak Against Dollar
Zimbabwe’s bullion-backed currency is experiencing its longest run of losses against the dollar since it started trading on April 8.
The ZiG, short for Zimbabwe Gold, fell for a ninth consecutive day on Tuesday because of a shortage of dollars caused by a lack of sellers in the interbank market as the new currency takes hold.
Dollars are now used in 60% of transactions compared with 85% when the ZiGs was adopted, with the local unit making up the balance.
The scarcity has forced the central bank to pump $190 million into the market to support the ZiG, a Reserve Bank of Zimbabwe monetary policy committee member, Persistence Gwanyanya told Bloomberg in a Sept. 2 interview. Governor John Mushayavanhu didn’t immediately respond to a text message seeking comment.
The ZiG is the southern African nation’s sixth attempt at having a functioning local currency in 15 years. Its predecessor, the Zimbabwean dollar, was scrapped after shedding value against the greenback every single trading day this year, bringing its losses to 80%.
The ZiG traded at a record low of 13.95 per dollar on Tuesday, according to data on the central bank’s website, and has lost almost 1% of it value since Aug. 29. It changed hands at between 16 and 26 per dollar on the resurgent street market, according to ZimPriceCheck.com, which tracks official and unofficial exchange rates.
