The Zimbabwe dollar dropped by $24.91 to average $881.7513 but it is failing to close the gap with the black market which now ranges from $1 000 to $1 300.
The rate was slightly higher than the interbank rate which stood at $875.6112. Industry has complained that the local currency is losing its function as a store of value as more people are using the United States dollar.
Reports have said that up to 80% of the transactions in the country are now in US dollars. The Confederation of Zimbabwe Industries says that the country is slowly but surely moving towards full dollarisation which is not good for the country.
The willing buyer-willing seller system is not working. “The current Willing Buyer Willing Seller (WBWS) platform is..failing to serve as a market-based platform due to limited interaction of forces of demand and supply,” the CZI said.
“While willing buyers are unlimited, there is a shortage of willing sellers at the platform. There is currently no basis for foreign currency earners to sell the foreign currency, as they can settle almost all of their obligations in USD.”
A total of US$19.6 million was allotted to 249 small and medium enterprises and 236 large firms today.
Offers ranged from $875 to $980 still way below the black market cash rate of $1 000.
The swipe rate is at $1 300. failing to narrow gap with black market