Reserve Bank of Zimbabwe governor John Panonetsa Mangudya has announced that the central bank in consultation with banks has set the starting rate for the trading of the United States Dollar against the “newly” introduced RTGS Dollar at 1USD:2.50RTGS$. The starting rate was announced by Mangudya at a monetary policy review meeting this morning.
This is the rate which will be used by the banks when the interbank trading starts after the governor lifted the imposed parity of 1:1 of the Bond Notes and the United States Dollar when he announced his Monetary Policy Statement earlier this week. The rate of 1USD:2.50RTGS$ is much lower than the rates which are currently obtaining on the streets of between 1USD: 3.9 RTGS$ and 1USD:4.2 RTGS$ and it remains to be seen how long the rate will remain at this level before the market forces it to change.
According to Mangudya the discrepancy between the rate on the streets and the rate that he has pegged is because on the street there is a “risk premium” as people face a jail term of up to 10 years for dealing in foreign currency without a licence.