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MONETARY POLICY Highlights
1) Overnight accomodation window adjusted from 50% to 70%. Move mearnt to discourage borrowing which destabilises the exchange rate and fuels inflation. Interests rates likely to spike for the second time
1) Overnight accomodation window adjusted from 50% to 70%. Move mearnt to discourage borrowing which destabilises the exchange rate and fuels inflation. Interests rates likely to spike for the second time
2) Economic growth expected to shrink by 3.2% for full year 2019. This comes on the back of cyclone idai, drought plus climate change.
3) Forex receipts in the economy up to June 2019 declined by 24% to close at $2.58b. There was a drop across the major forex earners: mining, remittances and agriculture. It is expected that pressure on the exchange rate will continue into the full year 2019!
4) Gold deliveries declined 40% from 17,3 tonnes to 12,3 tonnes H1 2018 v H1 2019. With gold being a significant export earner, this is likely to affect the exchange rate quite significantly
5) RBZ to issue cash notes+coins amounting to 10 to 15% of broad money supply. Broad money supply at $15b currently. This effectively restores the RBZ's power to create money. However Money supply growth to be contained within 10% for 2019
