The ascendance of President Emmerson Mnangagwa to power has created a positive perception in the economy, and has seen bond notes gaining some ground against some of the world’s major currencies on the illegal parallel market.
Even though the official rate of the Bond Note to the United States dollar is pegged at 1:1, in the last few months, the parallel market has been thriving.
There were also unjustified increases in the prices of basic commodities that saw the bond note, US dollar exchange rate going up to 1:US$1,90, but now it is down to 1:US$1,30.
A survey by our Bulawayo Bureau has revealed that on the black market, the bond note has been on the rebound after the Zimbabwe Defence Forces launched “Operation Restore Legacy” that culminated in Cde Robert Mugabe’s resignation as Head of State and the subsequent inauguration of President Mnangagwa.
Yesterday, illegal money changers on the streets of Bulawayo said their activities had been on the decline.
“We usual get cash supplies from people in the banking sector, while others brought it from as far as Harare, but in the past days our suppliers have vanished,” said one of the illegal traders. “The cross rates have also started declining, but we do not know why they are dropping.”
A financial market expert Mr Morris Mpala said the market was reacting positively to political developments, hence the plummeting rates on the parallel market.
“The perception is very positive and is based on the thinking that the future is much clearer,” he said. “We saw even foreign countries pledging to support the country. Hence the political confidence also creates positive economic vibes.”
Confederation of Zimbabwe Industries president Mr Sifelani Jabangwe expressed optimism that the stability in the financial sector would result in increased flow of money.
Mr Jabangwe said even the stock market had responded positively to President Mnangagwa’s rise to power.
“The demand is coming off and to some extent it’s a sign of confidence that something is about to happen, that the rates that were in existence are not sustainable, that there is a new dispensation now and there is a possibility that those in the Diaspora will bring more money, investors will bring more money,” he said.
Mr Jabangwe said normal cash flows would wipe out the black market, which will be an advantage for those in the business sector who were struggling to access hard currency.