THE inter-bank foreign exchange market has so far traded over $33 million since its introduction towards the end of last month, an official has said.
Speaking at the Institute of Chartered Accountants of Zimbabwe monetary policy review in Bulawayo last Friday, Reserve Bank of Zimbabwe (RBZ) deputy director for financial markets Mr William Manhimanzi said:
“To date over $33 million has been traded on the interbank foreign exchange market. It’s not necessarily what we gave them . . . we’re fairly pleased, obviously we want more trades to actually happen.
“Obviously, people are still holding on because of the 2,5 exchange rate, which was perceived to have been a fixed exchange rate and for those that follow the exchange rate you will see it moving trending upwards going forward.”
The inter-bank forex market started trading on February 22, two days after the announcement of the Monetary Policy Statement (MPS) by the RBZ Governor Dr John Mangudya.
Mr Manhimanzi said as monetary authorities they have noted that even before the announcement of the Monetary Policy Statement, there were people who took exchange rate positions based on speculative behaviour.
“We can’t just allow the exchange rate to depreciate because of people that took positions on the exchange rate. Our expectations are that banks act in a responsible manner and do not necessarily put pressure on the exchange rate,” he said.
Dr Mangudya is on record saying some companies were struggling to access forex on the official market because they cannot afford to buy it at 2,5 rate.
Mr Manhimanzi said the thrust of the 2019 monetary policy statement was to establish an inter-bank foreign exchange market to bring back forex trading outside the banking system as well as growing hard cash if the economy was operating without own currency.
He said the bond notes came into the economy as an export incentive although it later became a pseudo currency. The bond notes were introduced by the apex bank in November 2016 and were pegged at 1:1 against the US dollar.
“Remember the bond notes came into the economy as an export incentive and later became a pseudo currency, but we need to have a currency of our own. . .the bulk of the deposits that we have were electronic dollars sitting in our accounts hence the introduction RTGS dollars as a local currency. The RTGS dollar remains part of the multicurrency system and we have also said this should be the currency accepted for all carboned transactions,” he said.
Speaking at the same occasion, Bulawayo-based economic analyst Mr Morris Mpala said through the recent monetary policy statement, the Reserve Bank was seeking to restore credibility in the monetary sector.
“What the Central Bank was now trying to do through the recent monetary policy statement was sort of guide exporters so that they can get value for their money because in the past exporters have been losing out.
“And now by following what the parallel market has been doing already was now to bring back the interbank market so that there is willing buyer-willing seller so that anyone who has got forex can go to the formal market without being charged criminally and those that want to buy can go there and buy transparently,” he said.
But that being said, Mr Mpala said RBZ has got a priority list in terms of the banks that should get the forex and by so doing the monetary authority was becoming more of an autonomous body, a characteristic business has in the past been advocating for.
“The Reserve Bank has to be autonomous so that it can be able to offer guidance whether to Government or rates in terms of the monetary policy statement that cultivates the industry and private sector development, among others,” he said. —