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Bond Note NO LONGER 1:1 To US Dollar, Now Part Of The RTGS Dollars Family

  • The export incentives introduced in 2016 have been rendered insignificant by inflation and will now be discontinued.
  • One important factor: Essential imports such as fuel, cooking oil and power will get separate allocations from RBZ. These will not have to compete in the interbank market.
  • Tobacco and cotton growers will now get 30% of their crop sales in foreign currency. Tobacco merchants will retain 80% of their earnings.
  • Foreign currency requirements for Government expenditure and other essential commodities that include fuel, cooking oil, electricity, medicines and water chemicals shall continue to be made available through the existing letters of credit facilities.
  • The new monetary policy has defined bond notes, coins and banked money as RTGS dollars and from now on, banks will now be able to sell foreign currency to their customers using the prevailing daily exchange rate. Effectively the bond note is no longer 1:1 with the US dollar.
  • Asked about the ‘starting’ exchange rate for the RTGS$ against the USD, Mangudya, who says the parallel market rate is between 3-4RTGS$ to the USD, says the RBZ will not set a rate but let the market set the exchange rate.

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