Rates Retreat as the RBZ Brings out the Guillotine

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Last week Friday the RBZ decided to flex its muscles against mobile money operators whom the bank accuses of fuelling the foreign currency black market. This time though the blow was more surgical unlike last year’s clumsy blanket ban on cash-ins and cash-outs.

This time around the Bank’s Financial Intelligence Unit sussed out a list of suspected mobile money wallets from both Ecocash and OneMoney. The list of over a 100 wallets was then sent out to banks with the directive that they freeze the wallets and their linked bank accounts immediately.

The result was a mild firming of the local dollar which hasn’t had a break in a while. In the low volume market rates have this week, most certainly as a result of the RBZ’s actions, gone down to around 1 USD:45 ZWL from as high as 1 USD:50 ZWL. In fact due to muted trading as evidenced by low traffic in a lot of Forex-related WhatsApp groups some people have been offering rates as low as 1 USD: 42 ZWL.

This too shall not last

We have seen this dance countless times before including during the cited blanket ban on cash-ins and cash-outs. In fact, curiously some of the measures put in place after the ban such as limiting cash-ins at $500 ZWL remain in place and yet the rates have continued to climb.

As with the directives and measures before it, this does not address the fundamentals facing businesses when it comes to foreign currency. Despite promises to the contrary the RBZ and the government have conspired to keep the rates fixed at the arbitrary 1USD: 25 ZWL point instead of freeing up the market.

The result has been that most companies even the large formal ones have been left on their own when it comes to raising much needed foreign currency to finance their operations as none is coming from the formal legal circles. For these companies, there are only two options sink and die or swim in the murky world of illegal foreign currency trade. Suffice to say most have chosen to swim.

What will happen to the culprits?

Illicit foreign currency deals are very difficult to prove especially given the fact that one side of the transaction involves cash. In fact with a little bit of creative accounting, something most Zimbabwean entities are familiar with, the RBZ’s Financial Intelligence Unit will be put to their defence quite easily.

It’s not clear what punishment the culprits will face but given the circumstances and past experience, most will probably walk unscathed. Past account freezes have eventually been lifted, again because it is notoriously difficult to prove the charges being levelled here.

About the Author
Garikai Dzoma is the founder and editor of zimpricecheck.com

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We are a team of independent analysts whose primary focus is research into the Zimbabwean parallel markets as well as the stock market. We strive to bring you the most accurate rates in the market and our independence means we have no bias on these rates. You need to make your business decisions and we strive to be your best source of information.


As Market Watch we do not deal in the parallel market nor do we quote on behalf of any other person or company. We are not traders and cannot be accountable for any decisions you make around our data. We are researchers only so please do not assume our information is accurate. Our information comes from various sources including social media as well as market informants on the street. For official USD and RTGS rates please consult your banking partner or the Reserve bank of Zimbabwe. Please note it is illegal to deal on the parallel market and we strongly advise against it. Our platform documents the rumoured parallel market that is mentioned on social media and various other sources.

The Lingo


The ‘Old Mutual Implied Rate’ is a comparison between the Old Mutual share price on the London stock exchange / the Johannesburg stock exchange and the Zimbabwe stock exchange. Effectively RTGS is valued at 1:1 with the USD, but this difference in share price gives us the implied countries exchange rate.


Real-time gross settlement systems (RTGS) is a funds transfer system where money transfer takes place from one bank to another on a “real time” basis and “gross” basis. Settlement in the “real time” means that the transaction happens almost immediately.


The Zimbabwe Bond Note is a surrogate currency issued by the Reserve Bank of Zimbabwe. This was originally issued against a loan facility from the African Export-Import Bank. The Bond Note is officially 1:1 however the market seems to have significantly discounted the value of the Bond Note.


The symbol ZAR is the currency abbreviation for the South African rand.