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An ideal RTGS$/USD Exchange Rate(A thread)
1) So many attempts have been made to predict the ideal exchange rate between the USD and the RTGS$. This process can never be a thumbsuck exercise. It should be informed by official statistics on our monetary aggregates
1) So many attempts have been made to predict the ideal exchange rate between the USD and the RTGS$. This process can never be a thumbsuck exercise. It should be informed by official statistics on our monetary aggregates
2) In this thread we use two variables:
a) The RTGS Market Position or the total aggregate of all funds held on all banks' RTGS Positions. This is money that is available in immediate circulation,
b) Total Forex Holdings- Cash+ Nostro balances in foreign Banks
a) The RTGS Market Position or the total aggregate of all funds held on all banks' RTGS Positions. This is money that is available in immediate circulation,
b) Total Forex Holdings- Cash+ Nostro balances in foreign Banks
3) Using the two variables the Implied exchange rate between the RTGS$ and the USD is as shown on the Trend (Red line) on attached diagram.
@BrezhMalaba @Mathuthu
@BrezhMalaba @Mathuthu
4) This leaves us to conclude two things:
a) If the monetary authorities manage to maintain the money supply constant, the exchange rate should nt exceed RTG$9.50 per $1,
b) Events in the market signify a market still trying to establish an equilibrium.
a) If the monetary authorities manage to maintain the money supply constant, the exchange rate should nt exceed RTG$9.50 per $1,
b) Events in the market signify a market still trying to establish an equilibrium.
Stats Credits: rbz.co.zw
