Severe foreign-exchange shortages have shaped monetary policy in recent years, undermining all economic activity. The effective dollarisation recognised in 2009 added a new dimension to this, with monetary policy rendered even less effective. It is possible that a new administration dominated by ZANU-PF would return to previous monetary policies, despite their damaging economic impact. Bank lending rates have fallen sharply with the decline in inflation, but the pace of the slowdown is likely to moderate given liquidity issues and continuing problems in the banking sector.