RBZ Weekly Forex Allocations Hit US$36,8m

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By Alois Vinga

RESERVE Bank of Zimbabwe (RBZ) this week allotted a total US$36,8 million to support local productivity amid the implementation of a cocktail of measures to further strengthen the platform and harness stability.

A trading update released at the close of business Tuesday shows that a total of US$36,8 million was allotted on the two platforms with priority tilted towards supporting industrial productivity needs.

In the main auction, a total 413 bids were accepted with a total value of US$30,1 million.

Out of the total, raw materials needs were allotted US$12,2 million, machinery and equipment US$7,3 million, consumables US$2,2 million, services US$2,3 million, retail and distribution US$3,5 million, pharmaceuticals and chemicals US$1,4 million.

The trend was sustained on the Small to Medium Enterprises Auction platform where a total 1 102 bids were received.

Raw materials needs were allotted US$1,5 million, machinery and equipment US$2,3 million, consumables US$1 million, services US$554 119, retail and distribution US$724 837, electricity US$44 593, pharmaceuticals and chemicals US$278 587, paper and packaging US$140 942.

The official exchange rate reached US$1: $138,19 up from US$1: $134,08 recorded last week, hailed by market watchers as a positive step considering the fact such depreciation is coming at a time when the parallel market rates are stable.

The latest statistics come at a time when the central bank is implementing a raft of measures aimed at strengthening the platform following recent clearing of nearly US$200 million allotments backlogs from the auction.

Apart from the auction allotment, the RBZ is also assisting local companies with facilities to access foreign currency through other facilities as well as making payments for urgent transactions required especially for those companies still owed foreign currency.

Economic Analyst, Persistence Gwanyanya commended the central bank for accepting the advice given by the Monetary Policy Committee ion backlog clearance.

“This will go a long way to push corporates out of the parallel market thereby prolonging the relative Zim$ stability. The move also boosts confidence in the local currency and sustaining this path will surely result in attainment of the desired outcomes,” he said.

He said this, coupled with ongoing measures to mop up excess liquidity from the markets alongside ongoing engagements to detect and sniff out any loopholes with the potential to derail stability efforts will go a long way to strengthen the auction system.