In news that very few people if anybody was waiting for the RBZ will introduce a $100 note. Statutory Instrument 68A of 2022, released on the 6th of April rounds off the monetary interventions by the RBZ after the first quarter of 2022. The SI contained a description of the note with further details such as the release date not included.

SI 68 A

The instrument focuses on descriptive features of the note though no images were provided. We will likely have to wait for RBZ releases with images of the notes and features. The authorities seem to be content if not happy with the cash shortages and have made no attempt to realistically address them. The coming of the new note then is likely not meant to impact people’s experiences with notes significantly.

Question of value

With the exchange rate depreciation experienced towards the end of the first quarter, the new “high denomination” notes will come in valued at 33 US cents, if nothing else changes by the time they are introduced. This isn’t a new phenomenon. The $50 note had an estimated value of 58 US cents on the official market and 42 US cents on the parallel market at introduction. The $5 note was announced at roughly 32 US cents. To use a simpler measure it cannot buy a loaf of bread. In fact, no note has been introduced in the new Zimbabwean dollar era with the ability to buy a loaf of bread that consistently costs US$1.

Do the reasons make sense?

We’ve been given reasons before for these denominations. Cash was blamed for easily fueling parallel market activity but clearly, these coins in notes clothing have not stopped the parallel market. One would in fact argue that the parallel market has been even stronger with the absence of cash on the market. banks just do not run the transacting game as they used to. People are on mobile money now. New initiatives such as  US dollar remittance services have allowed people to send US dollars across the country and move more transactions out of the old channels.

This is the song that doesn’t end

Less than a week after introducing old policies on new paper we see more of the same. The indicators have resumed their regular programming. Inflation took a break for 6 months but it is back on the increase and accelerating. The exchange rate after also taking roughly 9 months off, found its feet and then started to fly. And yet the band keeps playing the same song. All while the song starts reminding people of the hyperinflation era and the note introductions that came with it.