The Reserve Bank of Zimbabwe (RBZ) injected US$32 million into the interbank foreign exchange market over three weeks in October 2024 to stabilise the Zimbabwe Gold (ZiG) currency and address imbalances between supply and demand.
This move was essential to meet the rising demand for foreign currency as the country prepared for the summer cropping season and the festive period. According to RBZ Governor Dr. John Mushayavanhu, the bank’s intervention complemented the supply provided by authorised dealers, preventing further strain on the foreign exchange market.
The decision to inject this amount follows similar measures taken earlier in July 2024, when the RBZ injected over US$50 million into the market to ease pressures caused by rising import demand. These efforts highlight the central bank’s proactive approach in managing the nation’s foreign currency needs, particularly during periods of high economic activity, while ensuring that the ZiG currency remains stable amidst fluctuating global market conditions.
Dr. Mushayavanhu noted that the central bank had identified a build-up in pipeline demand for foreign currency at local banks, which created undue pressure on the foreign exchange market. The latest intervention was aimed at addressing this issue and stabilising the exchange rate in the face of increased demand, ensuring that economic agents and importers can meet their foreign currency obligations without significant disruption.
These interventions are part of the RBZ’s broader strategy to stabilise Zimbabwe’s macroeconomic environment. By maintaining currency and exchange rate stability, especially in the run-up to crucial periods like the agricultural and festive seasons, the central bank aims to support economic growth and ensure that businesses and citizens alike have access to the foreign currency they need for essential imports and other transactions.
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