New Zimbabwe.com

Interbank market transactions hit US$1.5 billion – RBZ

By Alois Vinga

THE Reserve Bank of Zimbabwe’s (RBZ) has reported the interbank foreign currency exchange market has seen US$1,5 billion traded since its introduction last year.

This came out in a statement by the central bank’s Monetary Policy Committee (MPC).

There is also growing hope the recent inception of the electronic deal system will improve efficiency within the financial sector.

Details are contained in a statement outlining the deliberations of the committee in its meeting of January 17 this year.

“We noted with satisfaction that as at 31st December 2019, an aggregate amount of US$1.5 billion had been traded on the interbank market.

“The MPC agreed that the RBZ should set aside appropriate foreign exchange resources to intervene and stabilise the market,” reads the statement.

This comes as Zimbabwean firms have raised concern the interbank facility was unable to avail enough foreign currency to meet their needs.

The situation has forced some business players to hunt for the scarce currency on the parallel market where it is in abundance although coming at a higher premium.

The committee expressed gratitude on that month-on-month inflation ended the year within close range of the MPC end 2019-year target of 15 percent which in turn led to exchange rate stability.

Said the MPC, “The stability of the exchange rate witnessed over the past four months, starting from September 2019, was a result of measures taken in 2019 to manage money supply.”

The MPC resolved to maintain the Bank Policy Rate on Overnight Accommodation at 35 percent.

The interest rate on the Medium-term Bank Accommodation (MBA) facility shall continue to reflect the yield on the Treasury Bills auction rate which is currently at between 15 to 18 percent.

The MPC said an amount of $150 million in direct cash was disbursed in the last quarter of 2019 to give a total of $1.1 billion of notes and coins in circulation in the country as at 31st December 2019.