Monetary Policy Committee (MPC), which is mandated to ensure exchange rate and price stability, met for the second time on Friday last week for a meeting where interbank foreign exchange market operations were discussed.
MPC, which was appointed by Finance Minister Professor Mthuli Ncube, includes central bank governor John Mangudya, two deputy governors, university professor Ashok Chakravarti and former opposition politician Eddie Cross.
The committee resolved to set up a working group to review the rules of the interbank market with a view to improving its efficiency.
The working group will comprise of central bank officials, treasurers from authorised dealers and members of the MPC according to Reserve Bank of Zimbabwe (RBZ) Governor.
“The committee also underscored the need to incorporate Bureaux de Change in the process in order to expand, deepen and enhance the operational efficiency of the interbank market,” Mangudya said.
“In addition, the committee agreed to launch the market tracker under the Reuters system, which is intended to enhance transparency in the operation of the interbank market, by the end of November 2019.”
Besides interbank foreign exchange markets, the Governor revealed the committee’s discussions on the exportation.
“The committee discussed the significance of exports to the country’s foreign exchange receipts and agreed on the need to support exporters by removing any bureaucracy that impede the administration of exports,” Mangudya said.
“At the same time exporters are expected to comply with Exchange Control regulatory provisions on the repatriation of export proceeds.”
“The committee resolved that all exporters that do not repatriate export proceeds within the statutory Exchange Control approved limits, shall forfeit their retention of export proceeds through the liquidation of such funds upon receipt onto the interbank market at the prevailing exchange rates,” Mangudya went on.
Other issues discussed by the committee include the need for RBZ to put in place measures to fund the productive sectors of the economy by redirecting excess liquidity in the financial system.
The committee also welcomed the 2020 National Budget address to Parliament by the Finance Minister.