Official exchange rate shoots to US$1:ZWL$1,888

THE official exchange rate at the Reserve Bank of Zimbabwe (RBZ)’s Foreign Exchange Auction System has jumped to US$1: ZWL$1,888, significantly narrowing the gap with the parallel market levels while US$14 million was allocated to businesses this week.

Last week, the rate was pegged at $1 404 to the United States dollar.

In an update yesterday after the weekly auction, the Apex Bank said a total of US$14,166,812,38 was allocated to bidders. The main auction was allotted US$13,209 million while the Small and Medium Enterprises (SMEs) got US$957, 712. The main action received 469 bids, down from 490 last week while the SMEs had 674 up from 569 received last week.

Yesterday marked the commencement of the pre-announced allocation envelope on a pure Dutch auction basis, which is expected to stabilise the exchange rate.

The Treasury has, among other measures, also granted 100 percent foreign currency retention to businesses on all domestic forex sales to ease the demand for foreign currency, which is one of the driving forces behind exchange rate distortions.-chromcilcle