The governor of the Reserve Bank of Zimbabwe announced a new monetary plan on Wednesday in an effort to stem the extreme hyper-inflation.

“The Zimbabwe dollar will be redenominated by a factor of one to 10, which means we are removing 10 zeros from our monetary value. Ten billion dollars today will be reduced to Z$1… effective from 1 August,” Mr Gono said in a television broadcast.

This news is somewhat welcome, I suppose. There’s a severe cash shortage in Zimbabwe and the country’s financial system is in ruin. The BBC reported on Wednesday:

The new Z$100bn (under $2, £1) note introduced last week is not enough to buy a loaf of bread. Inflation is officially running at more than 2,000,000%, but many analysts believe the true inflation figure is at least 9,000,000%.

A BBC reporter in Harare said that on the day he recently went shopping, a tray of 24 eggs went up from Z$375bn to Z$600bn. 

So far this year, Zimbabwe has been forced to print Z$100m, Z$250m and Z$500m notes in rapid succession, now mostly worthless.

Remember in 2006, Gono removed 3 zeros from the Zimbabwean dollar making a total of 13 zeros stripped in just 2 years.

This entry was posted on Wednesday, July 30th, 2008 at 7 am and is filed under africa, money, news, world, zimbabwe.