Black market rates soar
HARARE – The bond note has continued to lose ground on the black market, with rates reaching a staggering 100 percent to the United State dollar yesterday.
Last week, the bond was trading below 90 percent on the parallel market although it continues to trade at par with the greenback on the official market.
The Botswana pula, which was at 14 percent last week, has risen to 15 percent while the South African rand, which was at 11 percent in the comparative period, is trading at 12 percent.
Trades conducted via electronic transfers were fetching much higher premiums.
Analysts told the Daily News yesterday that the surrogate currency’s loss of value was an indication of serious economic anomalies.
Confederation of Zimbabwe Retailers president Denford Matashu says it’s high time government does something to eradicate the parallel market, which is a result of the foreign currency shortages blighting the official currency market.
He said the price movements mirror the underlying physical and monetary side of the economy.
Rather than blaming business for the crisis, Mutashu said government should fix the anomalies.
“We should never be talking about the parallel market; it’s a monster that has to be dealt with. We cannot plan on an illegality. It should not be existing in the first place because we want a formal economy,” he said.
“Authorities should deal with this. I don’t know why there has not been an effort to deal with this cancer which has continued to grow,” he said.
Industrialist Busisa Moyo said low foreign currency availability and uncertainty about government policy were the major causes.
“Rates in fact are going up daily because of increased demand as formal sources dry up due to forex inflow seasonality.
“The increases are driven by increasing costs as manufacturers and processors resort to the street to source foreign currency during this period of low foreign currency inflows and increased pressure on outflows for agricultural inputs and festive season restocking.
“The other driver is uncertainty about policy change,” said Moyo.