RBZ forex auction rate stabilises at $85

The average exchange rate for the Zimbabwe dollar against the US dollar was virtually unchanged at $85,36 on Tuesday from $85,24 last week on the Reserve Bank of Zimbabwe (RBZ)’s foreign currency auction.

This comes as the foreign currency auction system turns one-year-old yesterday.

Total allocations of the greenback was lower at US$44,7 million from record levels of US$46,9 million previously.

All accepted bids were fully allotted, with the big companies being allotted the bulk of the foreign currency at US$36,9 million, while SMEs took up US$7,8 million.

The RBZ remains the sole supplier of the hard currency through its auction platform.

The total number of bids on the auction platform marginally declined to 946 from a record high of 997 last week. A total of 880 bids were allotted.

This week the highest bid on both the SMEs and main platform was $90, while the lowest rate allotted on both platforms was $82.

Foreign currency disbursements to industries saw raw materials accounting for the bulk of allotments at US$14,4 million on the main auction and US$1,9 on the SMEs section.

Machinery and equipment came in second with US$8,2 million on the main and US$1,97 million on the SMEs section.

Consumables came in third on the main auction at US$2,9 million; but on the SMEs section, consumables took up US$1,93 million.

The foreign currency auction system has brought about pricing stability, and both the fiscal and monetary authorities have maintained a tight leash on money supply growth.

Meanwhile, earlier in the day, the apex bank dismissed social media – driven rumours that it was mulling stopping the use of US dollars as legal tender.

“The Bank has noted with serious concern the continued circulation of false and malicious articles on social media alleging that Zimbabweans will no longer be able to pay for goods and services in foreign currency, particularly one article captioned:

‘Foreign currency no longer legal tender’.

“These articles and statements are false and should be treated with the contempt they deserve, as there is no policy or law that prohibits the use of foreign currency in Zimbabwe as alleged,” said RBZ governor Dr John Mangudya.

“The articles are at the behest of irresponsible, mischievous and malicious people who are always bent on purveying false statements calculated to cause unnecessary anxiety, panic, alarm and despondency within the economy.

“The statements are also calculated to discredit Government and the Bank’s progressive efforts and achievements in stabilising and growing the economy.

“The Bank wishes to reiterate that the public can pay for goods and services in local currency or foreign currency in accordance with the laws of the country and that they should ignore the malicious rumours being circulated on social media.”-herald.cl.zw