Golden Sibanda Senior Business Reporter
THE Reserve Bank of Zimbabwe (RBZ) has suspended the managed float foreign currency trading system and lifted controls on free funds to make it easier for the public to transact in the wake of the Covid-19 pandemic.
In line with similar swift responses to Covid-19 by global economies, the bank also came up with interventions to boost the domestic economy by more than doubling the $1 billion productive sector facility to $2,5 billion, reducing statutory reserves from 5 to 4,5 percent and cutting the bank’s policy rate from 30 to 25 percent to promote lending by banks.
Covid-19, which first broke out in China and has killed and infected hundreds of thousands across the world, has disrupted global production and distribution chains, sent markets into a tailspin and made it difficult for global and domestic markets to trade with each other or meet consumer demand.
RBZ Governor Dr John Mangudya said in a statement this evening that the measures were part of Government interventions, in line with President Mnangagwa’s call on March 23,2020, for measures to mitigate the devastating impact of Covid-19 on the Zimbabwe.
Dr Mangudya said the bank had made available an option to use free funds to pay for goods and services chargeable in local currency, taking into account limited forex resources negatively affecting balance of payments.