Zimbabwe Raises Benchmark Rate to 70% as Currency Plummets

Zimbabwe Reserve Bank Governor John Mangudya.

HARARE (Bloomberg) — Zimbabwe’s central bank has raised its key interest rate to 70% from 50% to try and stabilize a plummeting currency and surging inflation.

The step comes in the same week as the appointment of a monetary policy committee and was announced by John Mangudya, the governor of the Reserve Bank of Zimbabwe, in a monetary policy statement on Friday.

The Zimbabwe dollar, which was pegged to the dollar at parity as recently as February, is trading below 11 to the dollar and annual inflation, which wont be released until February, is estimated to be between 230% and 570% by economists.