RBZ Auction Defies Covid-19 Odds, Allots US$35.3 Million Amid Sustained Stability

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By Alois Vinga

CONTRARY to earlier market speculation that the current Covid-19 lockdown pandemic will trigger a slowdown in trades, the Reserve Bank of Zimbabwe (RBZ) has defied the odds, allotting a total US$35.3 million amid sustained exchange rate stability.

A trading update released at the close of the FX02/2021 auction trades shows that a total US$35.3 million was allotted to companies in line with the priority needs of boosting industrial productivity.

The amount is slightly lower than US$35.8 million allotted last week when the auction kicked off for the first time in the new year.

The amounts allotted in the past two weeks are much higher than the peak figures of US$33 million reached last year prompting market watchers to conclude that confidence in the auction is on an upward trend.

The official exchange rate closed the day at $82.08 against the US$1, gaining by one cent from the figure of $82.09 recorded last week.

The main auction which hosts large corporates received 260 bids.

A total US$32.5 million was allotted on the platform with a highest bid rate of $86 and a low of $80.

Priority allotments went towards raw materials support which earned US$14.9 million, machinery and equipment US$6.2 million, consumables US$1.6 million, services US$1.8 million, retail and distribution US$2.3 million, fuel, electricity and gas US$3.5 million with paper and packaging receiving the least amount.

On the Small to Medium Enterprises platform, a total 228 bids were received while nine were disqualified.

The total value of bids accepted was US$2.9 million with highest bidding rates reaching $87 and a low of $80.

Priority allotments went towards raw materials receiving US$723 820, machinery and equipment US$527 444, consumables US$681 830, services US$359 206 among other priority allotments.