Some Shops Halt Operations As The Local Currency Continues To Shed Value

Some shops have reportedly halted operations as a result of rapid depreciation of the value of the local currency against other currencies, particularly the United States dollar.

263Chat reports that businesses are closing arguing that conducting business was no longer sustainable as they would not be able to refill their inventories.

The rapid fluctuation of the local currency this week, particularly on the parallel market, created great panic within the business community.

Some responded by reviewing prices of their commodities up by great margins, all within a very short space of time.

Deputy Governor of the Reserve Bank, Kupukile Mlambo attributed the plunge of the local currency to the closure of the tobacco season. Addressing Parliamentarians earlier this week, Mlambo said:

The movement of the exchange rate are a reflection of the fact that we have come to an end of the tobacco marketing season. This country relies on four commodities for foreign currency, gold, tobacco, chrome and platinum, and between February to the end of August or early September we had only three, so the amount of foreign currency has declined and these movements are a reflection of that.

The country’s currency crisis has been said to be the worst globally following rapid fluctuations lately.

In an endeavour to ease pressure on the local currency that had continued on a downward spiral, the government, earlier this year, introduced Statutory Instrument 142 which outlawed the use of all foreign currencies for domestic transactions.

So far, the results are disappointing.

More: 263Chat

 

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