The Zimbabwean dollar
The revalued Zimbabwean dollar (ISO 4217 code ZWD) has been the currency of Zimbabwe since August 2006, when it replaced the old Zimbabwean dollar (ZWD) at a rate of 1,000 old ZWD = 1 ZWD (revalued). The ISO originally assigned a new currency code of 'ZWN' to this redenominated currency, but the Reserve Bank of Zimbabwe could not deal with a currency change. Therefore the currency code remains 'ZWD'. 1ZWD=100 cents
It is normally abbreviated with the dollar sign $, or alternatively Z$ to distinguish it from other dollar-denominated currencies. It is divided into 100 cents.
Thirteen new bearer cheques were released on 1 August 2006 in denominations from 1 revalued cent to $100,000 (revalued).
History
The old Zimbabwean dollar replaced the Rhodesian dollar at par, which in turn had been adopted in 1970 as a decimalization replacement of the Rhodesian pound at a rate of 2 Rhodesian dollars to 1 Rhodesian pound (R$ 0.71 = US$ 1.00). At the time of independence in 1980, one Zimbabwean dollar was still worth more than the US dollar (ZWD 0.68 = USD 1.00), but the currency's value has eroded rapidly over the years. On 26 July 2006 the parallel market value of the Zimbabwean dollar fell to one million to the British pound.
The Zimbabwean dollar was redenominated on 1 August 2006 at the rate of 1 revalued dollar = 1000 old dollars. The subunit is still cent, 1/100 of a revalued dollar. Also on 1 August 2006 the Government of Zimbabwe devalued the Zimbabwean dollar by 60% vs. the US dollar (see exchange rate history table below), from 101,000 old dollars (101 revalued) to 250 revalued dollars.
Inflation
Rampant inflation and the collapse of the economy have severely devalued the currency, with many organizations using the US dollar, the euro, the pound sterling, or the South African rand instead.
Early in the 21st century Zimbabwe started to experience hyperinflation. Inflation reached 624% in early 2004, then fell back to low triple digits before surging to 1,281.1% in December 2006. If policies do not change, the IMF has predicted an inflation rate of over 4000% for the year 2007.
The year 2007 has started badly as inflation reached another record high of 1729.9% in February. On March 19th, the IMF predicted that inflation will most likely hit 5,000% this year.
Currency Revaluation of 2006 (New Zimbabwe Dollar)
In October 2005, the head of the Reserve Bank of Zimbabwe, Dr. Gideon Gono, announced "Zimbabwe will have a new currency next year." New banknotes and coins were to replace the then current Zimbabwean dollar. Gono did not provide a name for this new currency.
In June 2006, Deputy Finance Minister David Chapfika stated that Zimbabwe had to achieve macroeconomic stability (i.e., double digit inflation) before any new currency was introduced.
On 31 July 2006, the Reserve Bank of Zimbabwe revalued the Zimbabwe dollar by one thousand to one. Thirteen new bearer cheques were issued and people were only given 21 days to exchange the old bearer