“Zimbabwe’s foreign exchange reserves rose to $509 million as companies liquidated their foreign currency positions, creating demand for the local unit.”, — write: www.epravda.com.ua
Zimbabwe’s foreign exchange reserves rose to $509 million as companies liquidated their foreign currency positions, creating demand for the local unit.
About this informs Bloomberg.
The strengthening of the local currency, known as the ZiG, was also helped by the central bank’s increase in key interest rates in September to 35% from 20%.
Last week, ZiG posted its first weekly gain since the devaluation at the end of September, rising to 25.60 per dollar.
“ZiG’s tight liquidity conditions against the background of tight monetary policy in the market increased the desire of economic agents to liquidate their currency positions.
These conditions greatly contributed to the strengthening of the national currency“, the chairman said Reserve Bank of Zimbabwe John Mushayavanhu.
According to him, as of November 6, reserves in local currency amounted to about 129 million dollars, while reserves in foreign currency amounted to 509 million dollars.
ZiG, which began operating in April and is backed by Zimbabwe’s gold and foreign reserves, is the country’s sixth attempt in 15 years to create a stable local currency to replace the dollar as the primary unit of exchange.
In September, the ZiG was devalued by 43% against the dollar at the same time as interest rates rose. This led to a jump in monthly inflation in October to 37.2% from 5.8% in September.