At the end of November, the International Monetary Fund (IMF) included China’s currency the Yuan (¥) into the exclusive group of currencies that make up the IMF’s Special Drawing Rights (SDR). This move gave China the acknowledging stamp of approval that it is one of the biggest players in the world’s economy. The United States also backed the move; although many suspect it is getting the chills over China’s growing influence across the globe.
Barely a month after the Yuan joined SDR group of currencies, Zimbabwe President Robert Mugabe is contemplating giving the Chinese Yuan a legal tender in the Southern Africa country by next year. This move will naturally boost Zimbabwe’s runaway hyperinflation, increase liquidity and help support the economy that has been anything but impressive since 2009.
Zimbabwe stopped using its currency back in 2009 after the economy was hit by hyperinflation that has risen by as much as 500 billion percent; effectively making the Zimbabwe’s currency ‘useless’. The country then began using a number of foreign currencies, including the US Dollar and the South African Rand.
Despite the fact that the …read more