Rbz to introduce bond notes; to convert half of us dollar receipts to rand and euros the financial gazette currency converter usd to pounds


IN an effort to ease the current shortages on cash, the Reserve Bank of Zimbabwe will introduce bond notes, convert part of all US dollar foreign exchange receipts to rands and euro and also limit daily cash withdrawals as well as reduce further the cash to be moved out of the country.

RBZ governor John Mangudya told journalists on Wednesday that Zimbabwe needs to go back to basics and restore the fundamentals of the multicurrency system which was adopted in 2009 silver chart price. He noted that Zimbabwe had gradually moved to being a single currency economy following the appreciation of the US dollar against other major currencies.

“Currency utilisation at the moment is currently skewed in favour of the US dollar in spite of South Africa making up 60 percent of the imports in South Africa,” he said.

Over 40 percent of Zimbabwe exports are to South Africa and around 60 percent of imports are from South Africa while 70 percent of tourists come to the country through South Africa.

However since dollarisation the skew of utilisation had moved towards the US dollar gold chart 2016. In 2009, US dollar use was at 49 percent and rand use and 49 percent while other made up the remaining two percent stock market futures definition. However in 2013 the use was at 50-50 while there was a gradual move towards the US dollar from 2014 at 60 percent, in 2015 70 percent and 95 percent in 2016.

Mangudya said in order to go back to the basics of restoring the fundamental principles of the multi-currency system, the central bank would increase the availability and usage of other currencies within the basket.

“This policy measure is designed to ensure that we spread the demand for cash amongst a wide range of currencies and in order to mitigate concentration risk.”

He however said that the framework shall not apply to diaspora remittances and non-governmental organisations where the receipts will continue to be treated as free funds in line with the existing framework.

Mangudya also said the RBZ had also established a $200 million foreign exchange and export incentive facility which is supported by the Afreximbank to provide a cushion on the high demand for foreign exchange.

However the facility will only come as bond notes and will have an incentive facility of 5% on all forex receipts, including tobacco and gold sale proceeds,

In order to mitigate against possible abuses of the facility through capital flight, funds shall be granted to qualifying exchange earners in bond coins and notes which shall continue to operate alongside the currencies at par with the US dollar.

“The Zimbabwe Bond Notes of denominations of $2, $5, $10, and $20 shall therefore be introduced in future,” he said without giving a timeframe.

“I do not have a timeframe for the introduction of the notes as we are still at the design stage but possibly in the next two months 10101 binary. The notes, just like the bond coins, will be printed outside the country.” Mangudya emphasised that the bond notes did not however signal a return to the Zim dollar.

He said the US$200 million facility shall also be used to discount trade related paper in order to provide liquidity for business trading operations.

Mangudya also set new cash export and withdrawal limits, binary arithmetic operations. Daily cash withdrawal limits from within the branch and ATMs are now at US$1000, Euro 1000 and R20 000 with immediate effect.

Maximum cash allowed to be taken outside the country has been revised downwards to US$1 000, Euro 1 000 and R20 000 from the previous US$5 000.

As a multi-currency policy measure, Mangudya said the framework shall require the enforcement of multi-currency pricing of goods and services.

Accordingly, he added, “In view of the fact that most products in Zimbabwean shops are from South Africa, it is pertinent that shop owners and businesses should think in Rand term as opposed to abstract USD prices.”

Other measures include displaying of international exchange rates in all banking halls, wholesale and retail outlets usd inr forecast. Also, all retailers, wholesalers, businesses, local authorities, utilities, schools, universities, colleges, service stations informal sector among others are with immediate effect required to install and make use of the requisite POS machines in order to reduce demand for cash.

Payment system providers are encouraged to further improve efficiency and interoperability of the systems which will go a long way in enhancing usage and stability to the transacting public rm to usd. The players are also encouraged to undertake consumer education and awareness.

He said the central bank will at first use moral suasion for retailers but would be forced to use the Money Laundering Act against those who didn’t follow the directive.

Furthermore, Mangudya said the country should benefit from SADC regional payment systems usd to yen conversion. He said the process to reconfigure the RTGS system into multi-currency is already underway and the system will go live on 13 June 2016.

The savings products shall have a minimum balance of $10 000 or Euro 10000 and ZAR 20 000, minimum term structure of six months, annual interest rate of 5% on UD and Euro balance and 10% on Rand deposits and tax free.

In addition to the measures, Mangudya said the RBZ and Business representative bodies have come up with a foreign exchange priority list which will guide banks in the distribution of foreign currency towards competing demands usd to inr today. FinX Priority Level

• Non-exporting importers of raw materials and machinery for local production (value addition) that directly substitute import of essential goods

• Cash depositing clients in retail and wholesale usd jpy exchange rate history. The customers who generate cash which can either be recycled for local use or repatriated to replenish nostro accounts

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