Zimbabwe on course to meet 2020 budget deficit target — finance minister

Zimbabwe’s central bank Friday left its benchmark lending rate unchanged at 35 percent in a bid to curb speculative borrowing by illegal dealers who fuel the parallel foreign exchange market.

In a monetary policy committee statement, the Reserve Bank of Zimbabwe said its policy rate for overnight accommodation would remain at 35 percent annually.

Early this year, it more than doubled the rate from 15 to 35 percent to curb speculative borrowing and manage foreign exchange pressures.

It said it took the action “to reduce excess liquidity on the market which could be channelled towards purchasing of foreign currency thus putting pressure on the exchange rate”.

Zimbabwe is being buffeted by its worst economic crisis in over a decade, including a scarcity of basics like fuel and cornmeal.

Lately it has been grappling hyperinflation, with the rate soaring to almost 840 percent in July.

Until the government reintroduced the foreign currency auction in June, after stopping 16 years ago, the prices of goods were rapidly spiking as the local dollar trailed far behind the greenback.

President Emmerson Mnangagwa, who took over from long-time ruler Robert Mugabe after a coup in 2017, has struggled to revive the economy

[AFP]

Vanguard News Nigeria.

Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.