The local currency, the RTGS dollar, has lost 16% of its value within the first month of introduction.
The Reserve Bank of Zimbabwe abandoned the 1:1 ratio between the bond note and the US dollar.
While the RTGS dollar was trading at 1:2,5 to the greenback on the official interbank platform when it was introduced, on the black market, it was as high as 3,5 to 3,8. It has now fallen to 1:2,8 on the formal market.
Harare economist Ashok Chakravarti called for the market to be freed of controls. He said:
When we proposed the interbank foreign exchange market, we did so with the mind that it would be liberalised in the sense of allowing the market to determine the rates free of controls.
But I think those are issues that will be sorted as time goes on. But we need to have transference rules that can govern the interbank platform, like how the stock exchange has trading rules.
This is because some banks have Nostro accounts, while others do not have. I would encourage the Ministry of Finance and the central bank to quickly put these rules.
Not to be confused with the global meaning of Nostro Account In Zimbabwe, a Nostro account is the USD foreign currency account held by local customers of banks in the country. The account is essentially a foreign currency account introduced in October 2018 by the... Read More About Nostro Account
The Reserve Bank of Zimbabwe (RBZ) is the central bank of Zimbabwe. Its offices are located at number 80 Samora Machel Avenue in Harare. The Reserve Bank of Zimbabwe operates under the Reserve Bank of Zimbabwe Act, Chapter 22: 15 of 1964. The Act provides... Read More About Reserve Bank of Zimbabwe