>The local currency has been under sustained pressure due to hyperinflation, currently at 1 098,8%.
ERIAB was expected to monitor and review the exchange rate monthly and make recommendations to the Reserve Bank on the fair value rate for the currency on the foreign exchange market.
In August last year, Gono devalued the local unit by about 60% to $250 against the benchmark US dollar from $101.
While the local currency is pegged at $250 to the US dollar it is trading above $3 000 on the parallel market.
In a bid to raise Z$160 billion to finance government capital projects, the Reserve Bank of Zimbabwe (RBZ) has issued its first trunk of long term paper this year that has a three-year tenure.
Economists interviewed said the issuing of the paper signals that the Reserve Bank might yet come up with more measures to help shift the current debt profile in favour of long-term commitments as opposed to short term.
Zimbabwe is saddled with a huge foreign and domestic debt after it stopped receiving balance of payments support from multi-lateral institutions in 2000. The government has been increasingly turning to borrowing aggressively on the local money market in order to finance its projects.
“Variable but fixed coupon rate of 350% in year 2007; 250% in year 2008 and 100% in year 2009 is payable at the Reserve Bank of Zimbabwe, Harare, half yearly on the dates to be indicated on the stock certificates by remittance to the credit of a bank or building society,” the Reserve Bank said in a statement. – Business reporter
Post published in: Economy