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US dollar/RTGS dollar rates fall as market self corrects

The second day of trading on the foreign currency interbank market witnessed commendable activity with indications that the US – RTGS dollar cross rate will stabilise to below three in the long term.

The product of the Monetary Policy Statement, the forex interbank market was off to a flying start with US$5 million worth of RTGS dollars traded on Friday.

FBC Holdings Executive and President of the Bankers Association of Zimbabwe, Mr Webster Rusere told the ZBC News that trade continued on Monday amongst different banking counterparties with bids averaging 2,4 RTGS dollars per 1 US dollar and sellers offering an average of 2,5231.

Trade volumes on Monday are expected to be released by the central bank later in the day. Consequently, rates on the parallel market continue to take a knock as the market is self correcting itself.

“The rates are going down here and we are feeling the pinch of the monetary policy. We used to get 400 RTGS dollars per US$100 but the rate has gone down to around 320 RTGS dollars per US$100.

Presenting the Monetary Policy Statement last week, Reserve Bank of Zimbabwe (RBZ) Governor, Dr John Mangudya dismissed a runaway parallel market rate, saying it is oftenly overpriced and sentimentalised.

The floating of the RTGS dollar was widely commended by industry captains as it is going to bring efficiency to the a market based foreign currency allocation.

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