World / Africa Zimbabweans fear return of hyperinflation with bond notes to cash runs out BL PREMIUM

Harare — In Zimbabwe, where worthless $100-trillion banknotes are reminders of the perils of hyperinflation, President Robert Mugabe is printing a new currency that jeopardises not just the economy but his own long grip on power. Six months ago, the 92-year-old announced plans to deal with chronic cash shortages by supplementing the dwindling US dollars in circulation over the past seven years with bond notes, a quasi-currency expected at the end of November. According to the Reserve Bank of Zimbabwe, the bond notes will be officially interchangeable 1:1 with the US dollar and should ease the cash crunch. The central bank also promised to keep a tight lid on issuance. But many Zimbabweans are sceptical, remembering the 2008 meltdown when the inflation percentage rate was running in the millions because of rampant money printing. Mugabe’s plan has already sparked a run on the banks as Zimbabweans empty their accounts of hard currency. Internal intelligence briefings seen by Reuters r...