Hyperinflation Alert: Mugabe’s Party Weighs Reintroducing Zimbabwe Dollar

 Bloomberg reports (My highlight)

Zimbabwe is weighing the reintroduction of the national currency it abandoned in 2009 in favor of the U.S. dollar as it struggles to meet its monthly wage bill, three members of the ruling party’s decision-making body said.

While the revival of the Zimbabwe dollar would allow the government to print money to meet its needs it could damage the popularity of President Robert Mugabe’s Zimbabwe African National Union-Patriotic Front, said the people, who asked not be identified because the discussions are private. Patrick Chinamasa, the country’s finance minister, didn’t answer calls made to his mobile phone.

Zimbabwe abolished its national currency in 2009 after inflation surged to 500 billion percent the year earlier, according to International Monetary Fund estimates, and the party lost its parliamentary majority in elections while retaining the presidency. Last year Mugabe, 90, won re-election and Zanu-PF defeated the Movement for Democratic Change to regain control of parliament and end a four-year coalition government.

The party’s politburo is trying to decide whether it will do more harm to its image by reintroducing the currency and meeting its wage commitments or continuing to use foreign exchange, protecting the country’s citizens against inflation, the people said. A majority of politburo members are currently against its reintroduction, they said.

Just think of the reintroduction of the Zimbabwe dollar as an example US money printing policy on steroids, as it provides a good idea as to how US dollar money printing is also about providing funds for government operations.