![]() In June 2022, the RBZ raised the policy rate by 12,000bps to 200.00% in an attempt to contain high inflation and speculative borrowing, which have been feeding into currency depreciation. While the RBZ has issued gold coins with liquid asset status in an effort to tackle depreciation of the Zimbabwe dollar, we note considerable risks to Zimbabwe’s FX regime, and do not rule out a re-dollarisation in H222 or 2023 if inflationary pressures continue to accelerate unabated.Īt Fitch Solutions we expect the Reserve Bank of Zimbabwe (RBZ) to hike its policy rate by a further 2,000 basis points (bps) to 220.00% by the end of 2022.With inflation remaining sticky for longer, and the risk of rapid growth in money supply in the run-up to general elections in 2023, we now expect the RBZ to raise the policy rate further, to 240.00% in 2023.Elevated inflation, partly due to Russia’s invasion of Ukraine, and ongoing depreciation of the Zimbabwe dollar on the black market will prompt a hawkish stance by the RBZ.At Fitch Solutions we expect the Reserve Bank of Zimbabwe (RBZ) to hike its policy rate by a further 2,000 basis points to 220.0% by the end of 2022, despite holding the rate at its July meeting. ![]()
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