HARARE – Latest data from the Reserve Bank of Zimbabwe (RBZ) shows that reserve money for the week ending 20 November 2020, rose 20.93% to ZW$18.37 billion from ZWL$15.19 billion on 13 November 2020.
According to the weekly report, this largely reflects an increase in banks’ liquidity (RTGS balances) at the central bank, by ZWL$3.09 billion.
“The rise in reserve money was largely due to an increase in Government expenditures, associated with payment of annual bonuses, in addition to Government’s monthly salary and wage bill,” RBZ stated.
Reserve money refers to currency in circulation plus commercial banks’ deposits with the central bank and other deposits to the same.
“This saw Government deposits at the Reserve Bank falling by ZW$2.33 billion during the week under review, thus injecting liquidity into the market.”
RBZ added that: “The increase in reserve money is well within the Bank’s targeted 25% quarterly growth in reserve money by end-December 2020.”
Expenditures for the period January to September 2020 were ZWL$84.9 billion, against a target of ZWL$49.4 billion, according to the treasury. Of this amount, current expenditures amounted to ZWL$53.0 billion, transfer to provincial and local authorities ZWL$688.4 million while capital expenditures and net lending amounted to ZWL$31.2 billion.
By year end expenditures are estimated to reach ZWL$162.4 billion.
“The main expenditures would be on employment costs estimated at 39.9% of total expenditure due to bonuses that would be paid as well as employment costs of recently recruited employees in the critical sectors, which are education and health,” Finance Minister Mthuli Ncube said while presenting the 2021 Budget Statement yesterday.
Capital expenditure and net lending are estimated at 33.6% of total expenditure