Central Bank Quasi-Fiscal Losses and High Inflation in Zimbabwe: A Note
AbstractZimbabwe's failure to address continuing central bank quasi-fiscal losses has interfered with both monetary management and the independence and credibility of the Reserve Bank of Zimbabwe (RBZ). Realized quasi-fiscal losses are estimated to have amounted to about 75 percent of GDP in 2006. Because they were financed by creating money creation or issuing RBZ securities, they contributed to the four-digit inflation reached in 2006. The remedy for the current situation is clearly to eliminate the causes of losses by implementing measures to improve the cash-flow of the bank and restore its financial position.
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Bibliographic InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 07/98.
Date of creation: 01 Apr 2007
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This paper has been announced in the following NEP Reports:
- NEP-AFR-2007-05-26 (Africa)
- NEP-ALL-2007-05-26 (All new papers)
- NEP-CBA-2007-05-26 (Central Banking)
- NEP-MAC-2007-05-26 (Macroeconomics)
- NEP-MON-2007-05-26 (Monetary Economics)
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