The Reserve Bank of Zimbabwe (RBZ) raised the main interest rate for the umpteenth time this year to 200% from 80% citing imported inflation which is causing exchange rate volatility.
RBZ last reviewed the interest rates on April 4, 2022 to curb speculative borrowing.
“The Committee noted that the increase in inflation was undermining consumer demand and confidence and that, if not controlled, it would reverse the significant economic gains achieved over the past two years,” RBZ Governor who doubles as the MPC Chairperson, Dr. John Mangudya said in a statement.
“In that regard, the MPC resolved to put in place the following measures to align the interest rates with the inflation developments, enhance the circulation of foreign exchange and introduce an investment instrument to assist holders to store value in gold coins.”
The MPC also resolved to increase the Medium-Term Accommodation interest rate from 50% to 100% per annum; increasing the minimum deposit rate for ZW$ savings from the current 12,5% to 40% per annum and increasing the minimum rate for ZW$ time deposits from 25% to 80% per annum.
Statutory Reserve Requirements have been maintained at 10% for demand and call deposits and 2.5% for savings and time deposits.
The committee also has introduced gold coins to be used to hedge against inflation.
“The MPC resolved to introduce gold coins into the market as an instrument that will enable investors to store value,” Mangudya said.
He added that “The gold coins will be minted by Fidelity Gold RefinHarareeries (Private) Limited and will be sold to the public through normal banking channels.” – Harare