Parralel Market Rates Tumble After RBZ Freezes Bank Accounts
The black market USD/ZWL rate came crashing down late yesterday afternoon after a week of freefall.
The sudden sharp decline follows a letter on Thursday from Wonder Kapofu of the RBZ’s Financial Intelligence Unit (FIU) ordered banks to stop all withdrawals and transfers from the accounts of Sakunda, Access Finance, Spartan Security, Croco Motors and related companies.
Part of the letter reads, “As we carry out further analysis, you are directed to freeze, with immediate effect, all accounts held in the names of the listed entities until further notice,”.
No reasons are given for the directive in the letter.
However, the parallel market reacted dramatically to this news. The USD/RTGS$ rate which had peaked at around $100 to $2100 Ecocash/bank transfer late Thursday, fell to around $1600 by 5 pm. The day closed with no rate as traders were seemingly trying to get to grips with the sudden market shift.
As of Saturday morning, the rate seems to have settled around $1150 which represents a 50% drop from the Thursday peak. This is the rate which had prevailing fro the better part of a month before the beginning of the week which saw the runaway bull run.
It remains to be seen if the rate will consolidate at this level. Another key issue is pricing. Some retailers had increased their prices on Friday morning in response to the dramatic rate increase on Thursday. Will they reduce their prices to the pre-Thursday levels?
These prices had been rising lately in response to the increase in the rate.
Only time will tell.
The RBZ directive is pictured below.
