The premium on the black market rate of the Zimbabwe dollar widened from 65% at the beginning of April to 101% at the end of the month, IH Securities says in its outlook today.
The Reserve Bank of Zimbabwe has introduced gold-backed digital tokens to shore up the local currency but IH Securities says that pressure on the local currency is likely to continue in the short term largely because of a confidence issue.
The tokens, which are selling for as little as US$10, were introduced yesterday and will mainly serve as a store of value with a vesting period of 180 days, though they will also be used for transactions.
The central bank said offers for the tokens will close tomorrow, 10 May, at mid-day.
Payment will be done on Thursday, 11 May and the tokens will be issued the following day, 12 May.
IH Securities said that the plunge in the black market rate might have been caused by the 100% increase in the Zimbabwe dollar component of salaries for civil servants as well as the cut in the policy rate to 140% as this hinted to increased money supply.