At the same time, prices in US Dollar terms remained flat, or even decreased. As at May, month-on-month inflation stood at 12.54%, and year-on-year inflation at 97.85%. The devaluation has been accompanied by rampant inflation in RTGS terms, with many goods and services now being effectively pegged to parallel market rates.On the parallel market, rates climbed from US$/RTGS$ 3.5 to US$/RTGS$ 12 during the same period. On February 25, the official interbank rate stood at US$/RTGS$ 2.5, and climbed to US$/RTGS$ 6.28 as at June 21. However, since its adoption, the RTGS Dollar has continuously lost value against the US Dollar at a pace of, on average, approximately 1% per day.Simultaneously, the RTGS dollar was expected to assume all other functions of a domestic currency. The intention was to strip the US dollar as a medium of exchange and serve more as a reserve currency.Concurrently, a new currency called the RTGS dollar, made up of electronic balances in banks and mobile platforms, bond notes and coins was introduced through SI 33 of 2019.This was followed by differential pricing of fuel January, 2019 and finally liberalisation of the country’s foreign currency market, through discarding the fixed 1:1 exchange rate peg between the US$ and the Bond note through the 20 February 2019 Monetary Policy Statement.The purpose was to encourage exports, diaspora remittances, banking of foreign currency and to eliminate the dilution effect of RTGS balances on Nostro FCAs. It started with the October Statement, which separated the FCA and RTGS accounts. In order to reduce the impact of the shocks, the currency reform took a gradual process.Government, through two Monetary Policy Statements of 1 October 2018 and 20 February 2019, set the tone for implementing currency reforms necessary for supporting fiscal consolidation and growth promotion.One of the key pillars being currency reform. In view of these economic imbalances, Government in October 2018, introduced the Transitional Stabilisation Programme, which seeks to address major policy reform areas required for stabilisation, rebuilding and transforming the economy to an Upper Middle Income status by 2030.This resulted in the resurgence of the parallel market whose exchange rate become the anchor of pricing of goods and services in the economy and the attending inflation. The financing of the expanding fiscal deficits combined with widening trade deficit, exerted pressure on the foreign exchange market.The resulting fiscal deficits were financed through Treasury Bills and recourse to the Central Bank’s overdraft window. However, the initiatives were not supported by restricted Government expenditure. The country in response, introduced the bond notes as an export incentive to promote exports and substitute imports.This resulted in declining foreign currency inflows, liquidity and cash shortages, as well as confidence challenges. The situation was worsened by recurrent unfavourable weather conditions, low commodity prices and high appetite for importing.However, the multicurrency system stifled growth, as the country could not utilise monetary instruments to influence economic activity, and gradually lost competitiveness compared to major trading partners.In its early stages, the multicurrency system brought some stability in terms of inflation. The country has been using the multicurrency monetary system since 2009, dominated by US$, South African Rand.