News, Rumors and Opinions Sunday Evening 4-14-2024

TNT:

Harembe: ZiG will definitively gain in value — Reserve Bank of Zimbabwe | The Sunday Mail (4/14/24)

ZIMBABWE marked an epochal moment in its history when it introduced a new currency, Zimbabwe Gold (ZiG), on April 5, taking a giant step towards bringing a lasting solution to exchange rate volatility, which, for nearly half a decade, has driven inflation and made saving in the domestic unit difficult.

This is the third time Zimbabwe has switched currencies since scrapping the domestic unit in 2009, amid the ravages of inflation in a country that had gone through fundamental changes in its agricultural land ownership, was buckling under the weight of sanctions and was closed to sources of cheaper external funding.

In the realm of international trade, the dominance of major global currencies such as the US dollar, the euro and the yen has been undisputed for many years.

However, there is a growing recognition of the benefits associated with conducting trade using local currencies.

By bypassing the need for constant conversion into a foreign currency, trade in local units offers numerous advantages. They include enhanced economic stability, reduced dependence on foreign exchange and increased autonomy for any country.

As inflation continued to wreak havoc on Zimbabwe’s currency, the annual rate climbed to 55,3 percent from 46,7 percent in February 2024, reflecting the pass-through effects on prices, which track the movement in the exchange rate.

In light of the high inflation challenges emanating from exchange rate volatility, many observers have wondered how just the change in the national currency could turn the situation around.

But Zimbabwe’s monetary authorities expect the new currency and policy measures they are rolling out to restore confidence in the local unit and go a long way in fostering simplicity, credibility, certainty and predictability in the country’s monetary and financial system.

New Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mushayavanhu last week shared his perspectives on how ZiG and the monetary policy intervention he announced just over a week ago in the 2024 Monetary Policy Statement (MPS) will transform Zimbabwe’s financial affairs.

The country’s new currency will operate alongside several foreign units in the multi-currency regime, legislated to run until 2030, including the US dollar, the pound sterling, the euro, the South Africa rand and Botswana pula.

ZiG shall, the RBZ said, at all times be anchored and fully backed by a composite basket of reserves comprising foreign currency and precious metals (mainly gold) received by the apex bank as part of in-kind royalties and kept in its vaults.

Foreign currency balances will accumulate through market purchases from the 25 percent export surrender requirements, as well as the sale of some precious metals received as royalties.

What has changed?

Responding to questions during an interview with Zimpapers Television Network (ZTN)’s “Beyond the Dollar”, Dr Mushayavanhu said the basket of precious commodities, mainly gold, plus the foreign exchange holdings the bank has, would change the game.

“We are bringing in a new concept in the form of a new currency, which is backed by reserves. RTGS, bond notes were not backed by reserves. This is why they were behaving the way they were behaving.

“So, we decided we have to bring in a new currency, which has a new basis for exchange rate determination and I did explain in the Monetary Policy Statement that the exchange rate for the ZiG is going to be determined by the basket of commodities that is anchoring it.

“Over and above that, it is also going to be determined by the market.

“We had a situation, as I said earlier, RTGS, bond notes were not backed by anything, so we cannot link ZiG to the old currency; it’s a different currency altogether,” he said.

Dr Mushayavanhu said while the bond notes were at some point backed by a US$200 million facility from Afreximbank, the amount of local currency in circulation was exceeded, exposing the local currency to forces of depreciation.

As part of RBZ’s commitment to transparency under his stewardship, Dr Mushayavanhu said the bank opened its vault for all to see that the institution indeed had the gold to back the domestic currency.
https://www.sundaymail.co.zw/zig-will-definitively-gain-in-value-rbz

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Tishwash: The toman breaks a new record by collapsing against the dollar

Iranian toman recorded a new record decline against the dollar, as the price of the US dollar in the free market in Tehran exceeded 65 thousand tomans for the first time, after the escalation of tensions between Iran and the occupying entity.

The price of the US dollar recorded 65,100 tomans this morning, Saturday, according to the prices announced by exchange offices in Tehran, and the price of the euro reached 70,400 toman on the same day, according to Iranian media.

The new round of record rises in exchange rates in the Iranian market, and in online transactions, began after the Israeli attack on the Iranian consulate building in Damascus, last Monday evening, April 1.

On the last working day of last week, the price of the dollar reached more than 64 thousand tomans, coinciding with clashes between the Jaish al-Adl group and Iranian military forces in Balochistan Province. link

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Frank26 [Iraq boots-on-the-ground report] FIREFLY: They talked a long time about how the national cards we have will be used for all transactions in our country. FRANK: The national cards tell Iraqi citizens that their currency is about to have value, that it’s about to go international. The International world would not want anything to do with the toilet paper valued currency. These are the hints. These are the telltale signs that they are are re-denominating and a new exchange rate is at your doorstep…

Mnt Goat the TRUTH finally coming out in the Iraq news. We don’t have to guess, it’s in all the news channels from Iraq now. Yes, the Iraqi dinar and the future revaluation of it is on the agenda for the April 15th visit of the Iraqi prime minister Al-Sudani to Washington, DC…The next stop is the in-country rate if all goes well that we should expect shortly after Al-Sudani’s return from Washington DC. We then know the rest of the process and what happens next…We can almost see the finish line as the train is about to come around the bend.

Foreign banks enter to the market

Nader: 4-13-2024

https://www.youtube.com/watch?v=xxCIZR8BWyk