HARARE – The Zimbabwean dollar is now in real peril, and well-considered policy measures must be implemented urgently to bring back confidence in the currency markets, industry representative body the Confederation of Zimbabwe Industries (CZI) has said.Zimbabwe uses a foreign currency auction system, administered by the central bank every Tuesday, to determine the exchange rate. However, CZI believes the Reserve Bank of Zimbabwe has not adhered to what was agreed on in putting up the Dutch foreign currency auction system, with knock-on effects.“In truth we find ourselves in a situation that could and should have been avoided had the appropriate policy prescriptions been in place,” it said. “After starting well, the Dutch foreign auction has now been distorted by a lag[1]ging supply stretching over 15 weeks in some instances and this has become a driver of the widening parallel market premium,” according to CZI.While the Zimbabwe dollar is trading at Z$88.66:US$1 on the official foreign […]
ZIM CURRENCY RISKS TAILSPIN
