John Mushayavanhu, Zimbabwe’s central bank governor, reassured that the country does not face a foreign exchange crisis. Recent interventions revealed a surplus in foreign currency reserves. Key businesses advocate for a free-floating exchange rate for the gold-backed currency, ZiG, to stabilize the economy.
In Zimbabwe, central bank governor John Mushayavanhu addressed concerns regarding a potential foreign exchange crisis, assuring that the country is well-positioned. He indicated that during a recent intervention, the Reserve Bank offered $20 million in foreign currency, of which only $15 million was bought, demonstrating the existing demand within the market and suggesting adequate foreign currency reserves despite worries over shortages.
Notably, prominent businesses have called upon authorities to permit a free-floating exchange rate for the local currency, which is denominated as a gold-backed unit known as ZiG. This request highlights the ongoing discussions about currency management in Zimbabwe amid efforts to stabilize the economy and restore confidence in local currency.
In summary, Governor Mushayavanhu’s remarks serve to alleviate fears of a forex crisis in Zimbabwe, emphasizing sufficient foreign reserves. The call from businesses for a free-float regime for the gold-backed ZiG currency reflects a desire to enhance market efficiency and restore confidence in Zimbabwe’s economic framework.
Original Source: iafrica.com
