Zimbabwe central bank calls for increased use of local currency

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THE Reserve Bank of Zimbabwe has called on the government to continue increasing the proportion of taxes paid in local currency to shore up the Zimbabwe dollar which today fell by $37.74 to average $5 827.7972 to the United States dollar.

The central bank’s Monetary Policy Committee, which met on Friday last week, said that the requirement by the government that companies should settle an increased proportion of their tax obligations in local currency had created the much-needed demand for local currency which is critical in sustaining exchange rate and inflation stability.

“The MPC also underscored the need for (the)government to continue increasing the proportion of taxes settled in local currency to sustain the optimal mix of dual currencies,” the MPC said in a statement.

The Zimbabwe dollar kicked off the year at $705.4164 on 10 January and plunged to a low of $6 926.5764 on 20 June before the government introduced measures to stabilise the local currency.

Source: ZimIsider