RBZ auction  allots US$32,8 million as MPC outlines new measures

Business Reporter

THE Reserve Bank of Zimbabwe (RBZ) Tuesday allotted a total US$32,8 million through the Foreign Exchange Auction system amid latest Monetary Policy Committee (MPC) measures to strengthen the economy.

A trading update released at the close of the weekly auction shows that 362 bids were received on the Main Auction with a total value of US$27,4 million .

Raw Materials needs earned US$12,7 million , machinery and equipment US$6,1 million, Consumables US$2,2 million, services US$1,9 million, retail and distribution US$2,2 million, pharmaceuticals  and chemicals US$1,3 million, paper and packaging US$679 268.

A similar trend was sustained on the SMEs Auction where 987 bids were accepted with a total value of US$5,3 million .

Raw material needs were supported to the tune of US$1,4 million , machinery and equipment US$1,8 million , consumables US$741 667 , services US$508 531 , retail and distribution US$454 214.

The allotments on the platform amounted to US$5,3 million.

The official exchange rate moved US$1: $145 up from the rate of US$1:$142,42 reached last week.

• New MPC measures

The MPC reiterated the need for the bank to remain focused on inflation reduction and putting in place additional policy measures in response to the resurging inflationary pressures and foreign exchange parallel market activities.

Under the new arrangements, the bank policy rate was increased from 60% to 80% per annum while the Medium Term Bank Accommodation facility interest rate was increased from 40% to 50% per annum.

The MPC reviewed upwards the minimum deposit rates for US$ savings and time deposits form 10% and 20% to 12,5% and 25% respectively.

Reserve money growth rates targets were further tightened by reducing the set target of 7, 5% by setting it at 5% for the quarter ending June 2022.

Further liberalising the foreign exchange market by allowing banks to conduct foreign exchange transactions of up to US$1 000 under an arrangement agreed upon between banks and the RBZ, in terms of which individuals with free funds and entities or corporates holding foreign exchange in their foreign currency accounts shall be free to sell foreign currency to banks on a willing buyer willing seller  basis.