Govt rigging the exchange rate: Biti

MDC Alliance vice president Tendai Biti has lashed out at the Reserve bank of Zimbabwe (RBZ) saying the central bank, through undue pressure from Government, is rigging the exchange rate.

Biti made the remarks while addressing an online platform, Digital Sunday Express.

The platform is discusses pertinent issues affecting Zimbabwe and brings on board various policy makers, politicians and businesspersons.

At Sunday’s online meeting and while responding to a question Biti, who was also Finance minister in the Government of National Unity, intimated that in efforts to rig the plunging Zimdollar the RBZ, in collusion with other government bureaucrats in the Finance ministry, was under instruction to keep the minting machine at Fidelity Printers rolling.

“The RBZ is pouring some money (into circulation and is) essentially rigging the RBZ-adminstered Foreign Exchange Auction Floor,” Biti claimed.

To butress his argument, the former Finance minister questioned why there continued to be no convergence between the parallel and official exchange rates with regards to the real value of the Zimdollar vis-a-viz the United States dollar.

“There is a parallel exchange rate of 1:120 and the official exchange rate remains stuck around 1:82 or 1:83,” Biti said.

The MDC Alliance vice president also spoke on the need by government and the monetary authorities to resolve what he called “the mess around the monetary policy and in particular the exchange rate”.

“The exchange rate is distorted.

“We are now maintaining a dual currency regime – foreign currency and our local dollar. The two can’t mix like water and oil.

“So, you have these huge distortions in the economy,” he added.

Biti’s comments come at a time when the Zim dollar has firmed against the US dollar.

The past two weeks have seen the Zim dollar firming against the US dollar as the forex auction system is proving to be working efficiently.

In conclusion, Biti impressed on the need for the Government of Zimbabwe to fully redollarise.