The central bank, the Reserve Bank of Zimbabwe has been urged to deal with the Old Mutual Implied Rate (OMIR) which is way above the black market or parallel market foreign exchange rates.
This comes when rates on the parallel market dramatically tumbled last week, a development attributed to RBZ’s move to freeze bank accounts belonging to Sakunda Holdings and other companies alleged to have been engaged in money laundering.
Some observers also attribute the change to new regulations which the RBZ issued to govern the conduct of Bureaux de change.
As the parallel market rate has fallen, the Old Mutual Implied Rate continues to soar unabated. On Monday 23 September, it was at 20.52 when the parallel market rate was at 15 whilst the interbank rate was at 14.91.
Insider Zimbabwe, a local publication, suggests that probably, the central bank needs to intervene as the OMIR continues to rise.
It is however imperative to note that OMIR is a proxy or a figure that is used to compute the implied exchange rate for that day based on Old Mutual share value between Zimbabwe, South Africa and England where they usually trade at the same market share price on all the stock exchanges.
Old Mutual shares trade at the same value on the 3 different stock markets which means the differences in the currencies is the implied rate between the currencies.
The exchange rate is derived from comparing the share price of 1 Old Mutual Share in Zimbabwe against 1 Old Mutual Share in South Africa. The difference between the value of these shares is the implied exchange rate between the ZAR and the RTGS. The same goes for the London Stock Exchange.
More: Insider Zimbabwe