Forex auction reopening deferred to next week

THE Reserve Bank of Zimbabwe (RBZ) has deferred to January 18 the recommencement of the foreign currency auction trading citing Covid-19-induced delays in submission of bids by businesses and organisations.

Formal forex trading was halted on December 14 due for festive season holiday and the first auction for 2022 was meant to resume tomorrow.

In a statement on Friday, RBZ Governor, Dr John Mangudya, said due to a spike in Covid-19 infections, most authorised dealers had failed to submit essential information required to carry out the due diligence on auction bid documentation.

“The Reserve Bank of Zimbabwe wishes to advise the public that the spike in Covid-19 infections has impacted negatively on the ability of authorised dealers to timeously submit essential information required to carry out the due diligence on auction bid documentation submitted by the clients,” he said.

“As a result, authorised dealers were not able to submit all the required information for the first auction of 2022, originally set for 11 January 2022.

“In order to give authorised dealers sufficient time to carry out the necessary due diligence and submit the required documentation, the first auction of 2022 will be on 18 January 2022.”

When the last auction was held on December 14, the auction rate was pegged at $108,7 against the United States dollar with a grand total amount of US$41,8 million allotted to bidders.

During the course of 2021, close to US$2 billion was allotted to different beneficiaries with the bulk of the funding going towards procurement of raw material and machinery and equipment.

The forex auction was introduced in June 2020 as part of measures to enhance access to forex resources by the productive sector as well as fighting the negative impact of illegal forex dealing and money laundering. — The Chronicle