- Reserve money dropped by ZW$12.7 billion
- Currency issued declined to ZW$61.95 million
- Bank’s liquidity balances fell to ZW$18.29 million
Harare – Zimbabwe’s reserve money balance decreased by ZW$12.07 million to ZW$28.26 billion in the week ending 12 November 2021 owing to a decline in the currency issued and banks’ liquidity balances at the Central Bank.
The decrease in reserve money is from a previous week ending 5 November 2021 position of ZW$28.27 billion.
During the period, currency issued and bank’s liquidity (RTGS balances) at the Reserve Bank declined to ZW$61.95 million and ZW$18.29 million respectively.
“Partially offsetting the decrease was an increase of ZW$68.17 million in required reserves,” the Reserve Bank of Zimbabwe said in the latest reserve money update.
A monetary reserve refers to the holdings of currencies, precious metals, and other highly liquid assets used to redeem national currencies and bank deposits and to meet current and near-term financial obligations by a country’s central bank, government treasury, or other monetary authority.
Recently, The Central Bank revised reserve money targets from 20% to 10% for the fourth quarter of 2021 and the first two quarters of 2022.
According to the Monetary Policy Committee, the decision to review the reserve money growth targets was informed by the reserve money growth outturn of 9.3% achieved in the third quarter ended 30 September 2021.
Currently, reserve money growth is at 27.07%, hence it is questionable whether the 10% target for the fourth quarter will be attained considering that the quarter is drawing to an end.
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