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Zimbabwe may need to raise sky-high interest rates even further

Photo: ANP

Zimbabwe’s central bank may need to raise interest rates further to curb inflation. The governor of the country’s central bank warned about this. With a current rate of 60 percent, Zimbabwe already has the highest borrowing costs of countries tracked by Bloomberg news agency.

Zimbabwe’s annual inflation rate stood at 60 percent in January. This is already a sharp decline from the peak in July 2020, when life became more than eight times more expensive on average on an annual basis. The country has been suffering from an ongoing economic crisis for years. By way of comparison, inflation in the Netherlands is more than 6 percent. In the eurozone it is about 5 percent.

The central bank’s goal is to reduce inflation to 25 to 35 percent this year. But the experts are already not counting on that this will be accomplished. Inflation is fueled by the increasing use of US dollars for payments. This is because the population does not trust the local currency.



Zimbabwe may need to raise sky-high interest rates even further
Source link Zimbabwe may need to raise sky-high interest rates even further

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