Is Increased Money Supply a Solution to Boost Zimbabwe Economic Growth Path?

Efficient business transactions requires both liquid cash and electronic transfers. In developing nations, due to technological challenges and level of awareness of the citizens hard currency is most preferred. The demand for currency, however should not be misinterpreted to mean acceptability of the currency. This paper seeks to analyse the increase is supply of bond coins in Zimbabwe and its likely impact on the economy. Money supply that is not fully backed with reserves has an adverse effect on the economy. Policy makers are advised to handle money supply issues with reference to basic economic principles to avoid adverse effects. The study indicates that a well-managed local currency is a strategic tool which the country can use to influence trade with other countries. However, introducing and managing expansion of a currency is not easy especially when the currency was previously rejected due to loss of value related to poor macroeconomic policies. The study calls for serious macroeconomic reforms rather than concentration on currency reforms, which is not an immediate solution to Zimbabwean crisis