By ETimes

Zimbabwe’s foreign currency deposits in October 2021 increased by 54% from US$ 1.20 billion in October 2020 to US$1.85 billion in October 2021 according to the latest figures released by the Reserve Bank of Zimbabwe (RBZ).
 
According to the report, on an annual basis, local currency deposits included in broad money registered a growth of 230.21%, while currency in circulation increased by 108.17%. Foreign currency deposits in broad money grew by 83.68%, from $97.62 billion in October 2020 to $179.31 billion in October 2021.
 
The annual growth in broad money, largely reflected increases of 179.32%, 246.62% and 211.68% in net claims on Government, public non-financial corporations and credit to the private sector, respectively.
 
Money supply also grew with broad money standing at $417.56 billion in October 2021, an increase of 145.95% compared to the money stock in October 2020.
 
According to the RBZ, the composition of broad money was constructed by, 56.53% local currency deposits, 42.94% foreign currency deposits, and currency in circulation which accounted for only 0.53%.
 
“On a month-on-month basis, broad money increased by $52.96 billion or 14.53%, from $364.60 billion recorded in September 2021. This was largely reflected in increases of $28.25 billion and $22.36 billion in foreign currency deposits and local currency transferable deposits, respectively,” the Bank said.
 
In the month of October 2021, domestic credit grew by 16.38%, to $262.34 billion on a month-to-month basis.
 
The growth was, largely driven by increases in banking system net claims on government which accounted for 36.93% of the debt. Public non-financial corporations’ borrowings constituted 17.16% of the credit with credit to the private sector coming in at 11.13%.
 
Credit to Government was largely composed of Treasury bill holdings. Credit to the private sector was mainly extended towards agriculture which accounted for 29.87% and households taking 21.95% of the total private sector debt.
 
In the private sector, firms specializing in distribution hold 12.36% of the total sector credit with manufacturing accounting for 11.03%. Financial organizations and mining account for 10.46% and 6.25% respectively – Harare

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