Zimbabwe dollar now at $6 713.35 to the US dollar- convergence by mid next month

The Zimbabwe dollar today dropped to $6 713.3462 to the United States at the central bank’s wholesale foreign currency auction narrowing the gap with the black market rate of $8 200 for swipe and zipit.

The premium at Tuesday’s auction was 30%. It dropped to 22% today. A currency is said to have stabilised when the premium is around 10%.

A total of 14 bids worth US$10.6 million were submitted today and all were accepted but only nine bids were allotted US$7 million.

Offers at the auction ranged from $6 600 to $7 200.

According to Zimpricecheck the cash rate is still as low as $2 600 but the electronic money rate ranges from $7 600 to $8 200.

It says the maximum rate businesses can use is $7 256.4393.
Some economists say that measures taken by the government and central bank are likely to see the local currency stabilised closing the gap with the black market.

One economist said if the current measures persist, convergence will happen by mid-next month, the dominance of the Zimbabwe dollar by August, and practical de-dollarisation by the end of the year.

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