The Reserve Bank of Zimbabwe (RBZ) foreign exchange auction this week allotted a total of US$13,6 million with the official exchange rate closing the gap on parallel market figures.
A trading update released by the apex bank on Tuesday shows that the official exchange rate moved to US$1:ZW$ 613,36, down from the ZW$604,25 recorded last week.
Economic watchers are of opinion that this will go a long way towards suppressing the parallel market exchange rate currently standing at US$1:700.
Economist Persistence Gwanyanya commented:
“It also proves the effectiveness of the economic measures implemented by the treasury and the RBZ for most part of the year.
“To support this, treasury this week went further to disclose the matters around the payment of contractors as well as disciplinary measures being implemented on errant contractors and their accomplices.”
He however, called on businesses to adjust prices in line with prevailing economic fundamentals.
“Pricing models based on arbitrage and speculation are fast becoming a thing of the past. It is time businesses complied otherwise they risk going out of business due to depressed demand as citizens pursue cheaper alternatives,” he said.
Meanwhile, on the Main Auction platform, a total US$11,5 million was allotted while on the SME Auction platform US$2 million was allotted to give a grand total of US$13,6 million.
The allotments were tilted in favour of meeting the productivity objective with raw materials US$5, 4 million, machinery and equipment US$2,8 million, consumables US$781 648, Services US$1 million, Retail and distribution US$766 563, pharmaceuticals and chemicals US$353 813, paper and packaging US$134 546.
A similar trend was sustained on the Small to Medium Enterprise (SMEs) Auction where a total 230 bids were received with a total value of US$2,1 million.