Zimbabwe suspends bank lending in bid to arrest currency decline

Zimbabwe suspends bank lending in bid to arrest currency decline

Zimbabwean government on Saturday ordered banks to stop lending with immediate effect in a move Harare said was designed to stop speculation against the Zimbabwean dollar and was part of a raft of measures to arrest its rapid devaluation on the black market, Reuters reported.

The southern African country reintroduced a local currency in 2019 after abandoning it in 2009 when it was hit by hyperinflation.

However, the Zimbabwean dollar, which is officially quoted at 165.94 against the U.S. dollar, has continued to slide on the black market, where it is trading between 330 and 400 to the greenback.

President Emmerson Mnangagwa on Saturday announced measures he said were meant to arrest the currency’s depreciation, which he said threatened Zimbabwe’s economic stability.

“Lending by banks to both the government and the private sector is hereby suspended with immediate effect, until further notice,” Mnangagwa said in a statement.

Leave a Reply

Your email address will not be published.