The Zimbabwe dollar will this week trade virtually unchanged 0,4 against the United States dollar at $84, 39 from $84, 4 previously following yesterday’s Reserve Bank of Zimbabwe (RBZ) foreign currency auction.
There were no disparities between bids accepted and bids alloted, but total foreign currency allocation declined to US$25 million, the lowest in some months.
All accepted bids were fully alloted, with the big companies being alloted the bulk of the foreign currency at US$23,1 million, while SMEs took up US$2,05 million.
Notwithstanding the lower uptake of foreign currency, optimism is abound that the tobacco season, which starts today (Wednesday) will further oil the foreign currency auction market.
Tobacco is one of Zimbabwe’s top foreign currency earners.
At the moment, the central bank is the sole supplier of the hard currency on the auction platform.
The total number of bids on the auction platform slid to 397.
334 bids were alloted.
This week the highest bid on the SMEs platform was $87,5, while that on the main auction was lower at $87. The lowest rate alloted on both platforms was $82.
Foreign currency disbursements to industries saw raw materials accounting for the bulk of allotments at US$11, 04 million on the main auction and US$532 813 on the SMEs section.
Machinery and equipment came in second with US$4,67 million on the main and US$387 153 on the SMEs section. And consumables came in third on the main auction at US$1,68 million; but on the SMEs section, consumables took up US$507 803.
The foreign currency auction system has brought about pricing stability, and both the fiscal and monetary authorities have maintained a tight leash on money supply growth.
The Zimbabwe National Chamber of Commerce (ZNCC) has said adherence to the 22, 5 percent quarterly reserve money targeting framework important in ensuring the market is not swamped with unproductive liquidity.