Foreign Currency Demand Increases On The RBZ Auction

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By Alois Vinga

THE demand for foreign currency continues to increase on the Reserve Bank of Zimbabwe auction with the number of bids sustaining an upward trend in the last three weeks.

In the first week of April, a total 397 bids were submitted by companies intending to purchase foreign currency from the platform.

Out of the total, 226 bids were submitted on the main auction while 171 bids were submitted on the Small to Medium Enterprises platform.

Last week, the auction processed a total 614 bids out of which 316 were submitted at the Main auction platform and 298 on the SME auction.

This week, the auction platform received a total 642 bids with 332 being filed at the Main Auction platform and 310 bids submitted on the SME platform.

Priority allotments went towards productivity with raw materials receiving US$12.2 million on the Main Auction while machinery and equipment received US$5.6 million, Consumables US$2.7 million, Services US$2.2 million, Retail and Distribution US$2.7 million, fuel electricity and gas US$2.1 million among other key allotments.

On the SME auction, raw materials were allotted US$1 million, machinery and equipment US$773 605, Consumables US$733 886, Services US$304 363, Retail and Distribution US$277 714, Fuel Electricity and gas US$215 992.

The official exchange rate remained stable at $84.43 against US$1.

Meanwhile, several listed companies on the Zimbabwe Stock Exchange continue to revere the auction system for bringing about pricing predictability, easing both monthly and annual inflation while enabling long term planning going forward.