Zim dollar slides as RBZ forex auction resumes

THE weekly Foreign Currency Auction Trading System resumed activity yesterday after the festive season break with the Zimbabwe dollar trading at 112,82 against the United States dollar.

The Reserve Bank of Zimbabwe (RBZ) closed the auctioning of forex on December 14 with the exchange rate pegged at 108,7 as most companies had closed for the festive season.

However, the weekly auction system that was initially planned to resume trading last week Tuesday but authorities citied Covid-19 induced delays.

In an update, RBZ indicated that a total of US$30,866 million was allotted at the first auction this year compared to US$41,8 million allotted to bidders at the last auction of 2021.

As has been the tradition, the bulk of the resources was yesterday allocated to firms for raw material procurement with a total of US$10,955 million allotted through the main auction.

Also for raw material procurement, US$1,437 million was disbursed to companies through the Small and Medium Enterprises (SMEs).

Other purposes for which the companies at the auction system were allocated foreign currency were machinery and equipment acquisition, sourcing of consumables like tyres and electricals as well as facilitating services such as loans, education, dividends, and disinvestments.

At yesterday’s auction, the SMEs auction accepted 492 bids while 141 were rejected.

The main auction received a total of 448 bids from which 320 were allotted.-The Chronicle