The Reserve Bank of Zimbabwe (RBZ) deputy governor, Dr Kupukile Mlambo has said demand for foreign currency in Zimbabwe is not as high as presumed by the general populace. Mlambo, however, called for patience noting that solving the foreign currency problems will take time.
Speaking to the Chronicle in a recent interview, Dr Mlambo explained that exchange rate distortions on the parallel market were driven by speculation fuelled by a cartel of individuals. He said:
Effective demand for foreign currency is not as high as people think because that is backed by the RTGS balances, which are not higher. What’s driving the parallel market is not really a high demand of foreign currency but there is a lot of speculation and my guess is that those who play in that market are not very many.
He further observed that returning to normalcy is a hard task given the challenges in the finance sector. Mlambo added:
It will take time obviously and I think we should not expect a magic wand to solve our foreign currency problems once and for all but this facility will help in narrowing the gap and stabilizing the rates.
Mlambo said that the government was hoping that exports such as tobacco would minimise the scarcity of foreign currency.
More: The Chronicle
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