The Zimbabwean dollar ( sign: $, or Z$ to distinguish it from other dollar-denominated currencies) was the name of four official currencies of Zimbabwe from 1980 to 12 April 2009. During this time, it was subject to periods of extreme inflation, followed by a period of hyperinflation.
The Zimbabwean dollar was introduced in 1980 to directly replace the
Rhodesian dollar
The Rhodesian dollar (''R$ or Rh$'', ) was the currency of Rhodesia between 1970 and 1980. It was subdivided into 100 cents.
History
The dollar was introduced on 17 February 1970, less than a month before the declaration of a republic on 2 Ma ...
(which had been introduced in 1970) at par (1:1), at a similar value to the US dollar. In the 20th century the dollar functioned as a normal currency, but in the early 21st century
hyperinflation in Zimbabwe
Hyperinflation in Zimbabwe is an ongoing period of currency instability in Zimbabwe that, using Cagan's definition of hyperinflation, began in February 2007. During the height of inflation from 2008 to 2009, it was difficult to measure Zimbab ...
reduced the Zimbabwean dollar to one of the lowest valued currency units in the world. It was redenominated three times (in 2006, 2008 and 2009), with denominations up to a $100 trillion banknote issued. The final redenomination produced the "fourth dollar" (ZWL), which was worth 1025 ZWD (first dollars).
Use of the Zimbabwean dollar as an official currency was effectively abandoned on 12 April 2009. It was
demonetised
Legal tender is a form of money that courts of law are required to recognize as satisfactory payment for any monetary debt. Each jurisdiction determines what is legal tender, but essentially it is anything which when offered ("tendered") in pa ...
in 2015, with outstanding accounts able to be reimbursed until 30 April 2016. In place of the Zimbabwean dollar, currencies including the
South African rand
The South African rand, or simply the rand, (sign: R; code: ZAR) is the official currency of the Southern African Common Monetary Area: South Africa, Namibia (alongside the Namibian dollar), Lesotho (alongside the Lesotho loti) and Eswatini ( ...
Indian rupee
The Indian rupee (symbol: ₹; code: INR) is the official currency in the republic of India. The rupee is subdivided into 100 '' paise'' (singular: ''paisa''), though as of 2022, coins of denomination of 1 rupee are the lowest value in use wh ...
Australian dollar
The Australian dollar (sign: $; code: AUD) is the currency of Australia, including its external territories: Christmas Island, Cocos (Keeling) Islands, and Norfolk Island. It is officially used as currency by three independent Pacific Island ...
,
Chinese yuan
The renminbi (; symbol: ¥; ISO code: CNY; abbreviation: RMB) is the official currency of the People's Republic of China and one of the world's most traded currencies, ranking as the fifth most traded currency in the world as of April 2022 ...
, and the United States dollar were used.
On 24 June 2019, the Reserve Bank of Zimbabwe abolished the multiple-currency system and replaced it with a new Zimbabwe dollar (the
RTGS Dollar RTGS may refer to:
* Real-time gross settlement
* Royal Thai General System of Transcription
* RTGS Dollar, Zimbabwe's currency since 2019
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The first dollar (ZWD) devalued from 0.6788 R$ to in 1978 to roughly half a million per US$ in 2006, when the currency was revalued.
This table shows in more detail the historical value of one US dollar in Zimbabwean dollars:
Second period of devaluation
In the first redenomination of 1 August 2006, 1000 ZWD were exchanged for 1 second dollar (ZWN). The second dollar started off with an official rate of 250 and a parallel rate of 550 to the . By July 2008 the exchange rate with US$ had reached (parallel rate) 500 billion to 1 , leading to a second redenomination.
More detailed data can be found in the table below:
Market data restoration
In the final months before Zimbabwe's central bank reforms of 30 April 2008, virtually all popular currency conversion resources relied upon the official rate of 30,000 ZWD to US$1 for published figures, in spite of the vast differences between that and free market rates. By 23 May 2008,
Bloomberg Bloomberg may refer to:
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* Daniel J. Bloomberg (1905–1984), audio engineer
* Georgina Bloomberg (born 1983), professional equestrian
* Michael Bloomberg (born 1942), American businessman and founder of Bloomberg L.P.; politician and ...
and Oanda began publishing floating rates based on Zimbabwe's formally regulated domestic bank market, while Yahoo Finance started using the updated official rate in July, albeit with a decimal point shift of 6 places. Those reported rates generally reflected the Official Rate as shown in the above table. They soon began to differ, in overvaluation of the Zimbabwean dollar, increasingly substantially in comparison to less regulated markets such as offshore markets or paper cash freely traded on the streets of Harare, reflected above as Parallel Rates.
Third period of devaluation
On 1 August 2008, a second redenomination was conducted, in which 10,000,000,000 2nd dollars (ZWN) became 1 3rd dollar (ZWR). On 3 October 2008, the
Reserve Bank of Zimbabwe
The Reserve Bank of Zimbabwe is the central bank of Zimbabwe and is headquartered in the capital city Harare.
History
The bank traces its history to the Reserve Bank of Rhodesia, founded on 22 May 1964, but which succeeded the Bank of Rhodesia ...
temporarily suspended the Real Time Gross Settlement (RTGS) system, halting electronic parallel market transfers, but it was reinstated on 13 November 2008.
After being introduced on 1 August 2008, the third dollar continued to devalue.
An overview of the exchange rate data can be found in the table below:
Final period of devaluation
On 2 February 2009, a third redenomination took place, in which the RBZ removed 12 zeros from the currency, with 1,000,000,000,000 (third, ZWR) Zimbabwe dollars being exchanged for 1 new (fourth, ZWL) dollar. Therefore, the fourth dollar (ZWL) is equivalent to 10,000,000,000,000,000,000,000,000, or 1×1025 or 10 septillion first dollars (ZWD) (or 1 trillion third dollars). Although the dollar was abandoned on 12 April 2009, exchange rates were maintained at intervals for some months.
On 4 June 2015, it was announced that the Reserve Bank of Zimbabwe would exchange some of the old banknotes for US dollars.
Value as collectable
Shortly after the Zimbabwean dollar was discontinued, they were purchased as curiosities, or in quantity as novelty gifts, for example to financial advisers' clients to show why they should invest in diverse assets instead of cash, which loses its value over the long term. Later they were purchased as an investment, to sell to collectors, for a very much better rate of return than most investments. In 2022 various denominations were sold on
eBay
eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became a ...
at prices exceeding £100.
See also
*
Argentine peso
The peso (established as the ''peso convertible'') is the currency of Argentina, identified by the symbol $ preceding the amount in the same way as many countries using peso or dollar currencies. It is subdivided into 100 ''centavos''. Its ISO 42 ...
- another currency that hyperinflated multi-trillionfold since 1970
*
Hungarian pengő
The pengő (; sometimes written as ''pengo'' or ''pengoe'' in English) was the currency of Hungary between 1 January 1927, when it replaced the korona, and 31 July 1946, when it was replaced by the forint. The pengő was subdivided into 100 fill ...
- a currency that dropped 29 zeroes in 1946
*
Zimbabwean bond notes
Zimbabwean bond notes are a form of banknote in circulation in Zimbabwe. Released by the Reserve Bank of Zimbabwe, the notes were stated to not be a currency in itself but rather legal tender near money pegged equally against the U.S. dollar. In ...
/
coins
A coin is a small, flat (usually depending on the country or value), round piece of metal or plastic used primarily as a medium of exchange or legal tender. They are standardized in weight, and produced in large quantities at a mint in order to ...
*
Banknotes of Zimbabwe
The banknotes of Zimbabwe were physical forms of Zimbabwe's first four incarnations of the dollar ($ or Z$), from 1980 to 2009. The banknotes of the first dollar replaced those of the Rhodesian dollar at par in 1981, one year after the proclam ...
*
Economy of Zimbabwe
The economy of Zimbabwe mainly relies on the tertiary sector of the economy, also known as the service sector of the economy, which makes up to 60% of total GDP as of 2017. Zimbabwe has the second biggest Informal economy in the world as a perce ...