By Alois Vinga
RESERVE Bank of Zimbabwe (RBZ) official exchange rate depreciated by 2,9% this week slightly moving to close the gap with the parallel market exchange rate.
A trading update released at the close of business Tuesday by the RBZ shows the official exchange rate moved to US$1: $127,84 up from $124,01 recorded the previous week, signalling a 2,9% decline.
The parallel market is trading at around US$1 to $200.
Commenting on the development, economist Persistence Gwanyanya hailed closing of the gap between the official and parallel market exchange rates as it would restore the local currency’s value.
“What is clear is that the official exchange rate is going up against a background where the informal exchange rate is becoming stable. The gap between the two exchange rates continues to close up which will go a long way to restore the local currency’s value,” he said.
He said this, coupled with plans to clear the foreign currency payment backlog in the next two weeks by the central bank would offset the pressure to get foreign currency from the parallel market by companies and further strengthen the Zimbabwe dollar.
Meanwhile, on the Main Auction platform, US$11,9 million was allotted Tuesday for raw materials, machinery, and equipment US$7,8 million, consumables US$2,4 million, retail and distribution US$3,7 million, pharmaceuticals and chemicals US$1,3 million among other allotments.
On the SME Auction, raw materials received US$1,5 million, machinery and equipment US$1,9 million, consumables US$1 million, services US$521 512, Retail and distribution US$616 198, pharmaceuticals and chemicals US$240 630.
A total of US$37,2 million was allotted on the two auction platforms.