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Zimdollar depreciates by 2.5% agains the real dollar

by finx
13 Aug 2020 at 20:21hrs | Views
The Zimbabwe dollar depreciated 2.5% to 82.5608 in Thursday's combined auction. The local currency has depreciated 69.7% from the fixed exchange rate of 25 and 30.52% from the auction start rate of 57.36.
 
According to results from the Reserve Bank of Zimbabwe, a total of US$18.77 million was allotted with the main auction getting US$17.98 million and SME's on 4% at US$789 866.02.
 
Raw materials received the highest allocation at US$7.8 million, Machinery and Equipment US$3million, Consumables US$2.6 million, Pharmaceuticals US$1.6 million and Services (inclusive of loans, dividends, and disinvestments) at US$1.2 million.  The remainder was allotted to Retail and Distribution, Fuel, Electricity and Gas as well as Paper and Packaging.
 
According to RBZ governor John Mangudya banks are now trading between US$20 million-$30 million a month outside the auction while about 70% of the allocations are from the country's top 20 industry companies.
 
The highest bid was at 90 for both auctions while the lowest accepted bid for the main auction was 77.0160 and 80 for the SME's. Over the past eight weeks, the difference between the highest bid and the parallel market rate has moved from 45.37% to 10.52%.
 
To note is the decreasing rate of depreciation of the currency, something which the authorities will take as a positive despite the continued fall. Three weeks ago, the local currency was down 6.01% and has since been on a downward trend of 4.60% at the last auction and 2.54 at today's auction. Prices of products have stabilised in most sectors but more transactions are in US$.

The average weighted rate was 7.2% higher than the lowest bid and 8.3% lower than the highest bid. The difference between the highest and lowest bid was down to 16.85% from 24.29% at the last auction, marking an improvement in the spread between bids.
 
Trades on the parallel market continued to be driven by small amounts as there is generally no float for big amounts. Most trades for small retailers are occurring on the Rand/US$ market for payment to runners.
 
The official rate is now at par with the cash parallel market rate which currently stands at 82. The Zipit rate for large amounts is now at 100-110 but the Baker's Inn sausage and chips combo remaining stuck at US$1 or ZWL$114 for 14 days now.
 
Mobile money rates were quoted at 95-97 for One Money and 90-94 for Ecocash transactions. Zipit lower amounts is currently at 105 per US$100.

Source - finx

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