Mid-term MPS: Reserve Bank Of Zimbabwe Increases Deposit Interest Rates

The governor of the Reserve Bank of Zimbabwe (RBZ), John Mangudya this week increased deposit interest rates “to promote savings.”

In the Mid-term Monetary Policy Statement issued on 11 August 2022, the central bank’s chief said the review was effective from 1 July 2022. Pindula News presents an excerpt from the statement:

Deposit Interest Rates

As part of measures to promote savings, the deposit rates for ZW$ savings were reviewed upwards from 12.5% to 40% per annum, while time deposits rates were increased from 25% to 80% per annum, effective 1 July 2022.

Many Zimbabweans have not been saving or depositing their money in the traditional banks since the record-high hyperinflation of 2008 which reached 5 billion per cent, according to the IMF, wiping their accounts to zero.

The continued depreciation of the Zimbabwe dollar is also contributing to the problem.

In a bid to curb inflation, the RBZ last month introduced the Mosi-oa-Tunya gold coin which has triggered mixed feelings.

Top economist, Prosper Chitambara, notes that gold coins are internationally being used in countries such as China, South Africa and Australia to hedge against inflation and as an investment opportunity.

He adds that they are not as widely used as currency as envisaged by Zimbabwe’s central bank.

Pindula News