Business Reporter
THE official exchange rate this week depreciated by 48,9% on the Reserve Bank of Zimbabwe foreign exchange auction as it moved to close the gap between the interbank and parallel market rates.
The parallel market rate is hovering around UDS$1: ZW$400 with the interbank rate standing around US$1: ZW$277.
A trading update released at the close of business Tuesday shows that the official exchange rate fell to US$1: ZW$ 258,54 compared to US$1: ZW$ 258,54 recorded last week.
Even the total amounts disbursed on the platform recorded a huge decline from the average of US$40 million a month disbursed weekly for most part of the auctionโs existence to US$6,8 million.
Market watchers speculated that the development signifies the platformโs compliance to President Emmerson Mnangagwaโs directives which underscored the needs to allot available resources.
The update also shows that allotments were biased in favor of raw materials which received US$3,1 million main auction, machinery and equipment US$1 million, consumables US$199 557 , services US$303 837, retail and distribution US$335 266, pharmaceuticals and chemicals US$50 000, paper and packaging US$531 908.
The platform received a total of US$5,6 million.
On the SME Auction, raw materials were allotted US$ 399 298, machinery and equipment US$ 421 176, consumables US$152 356, services US$118 337, Retail and distribution US$82 083, pharmaceuticals US$66 865
The total disbursed on the platform was US$1, 2 million to give a grand total of US$6,8 million.
Analysing the results, economist Persistence Gwanyanya said the developments is a reflection of changing market dynamics.
โRecently, the central bank committed to allocate the available foreign currency in a bid to ease the accumulation of backlogs which explains the US$6,8 million disbursed amount,โhe said.
He added that these factors will slowly lead us towards establishing the market equilibrium required by several market players.
