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Mthuli Ncube Implored To Avoid Announcing Monetary Policy Measures

1 year agoMon, 12 Jun 2023 15:41:31 GMT
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Mthuli Ncube Implored To Avoid Announcing Monetary Policy Measures

Economists have implored Treasury to desist from announcing monetary policy measures saying this undermines the role of the Reserve Bank of Zimbabwe (RBZ) in restoring confidence in the market.

The call came after Finance and Economic Development Minister Mthuli Ncube and the RBZ’s Monetary Policy Committee (MPC) recently made contradicting pronouncements on macroeconomic and financial developments in the economy.

In his statement, Ncube said all export proceeds that remain unutilised after 90 days will be liquidated onto the interbank market.

However, the MPC said, “in order to ensure that the interbank forex market is self-financing, the 90-day liquidation requirement on export proceeds will fall away”.

Speaking in an interview with Business Weekly, Zimbabwe National Chamber of Commerce (ZNCC) chief executive officer Christopher Mugaga Treasury should avoid announcing monetary measures. Said Mugaga:

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The Treasury should avoid announcing monetary measures because the central bank has never announced fiscal measures.

We are imploring the Treasury that any statement they think is necessary to the market, they can actually co-issue it or co-sign it than have a statement on monetary issues coming from the Treasury.

The signal that is created is that when the market starts losing confidence in the central bank, the sentiment will be like the Treasury does not have confidence in the central bank and once that happens even the currency issued by the central bank loses value because the market does not have confidence.

What makes people accept the currency is believing that the currency has value.

What needs to be solved possibly is the conflation of these two institutions (Treasury and RBZ) because it will create a challenge in the future, conflation in the sense that the central bank should never ever enter the arena of fiscal activities, either quasi-fiscal activities or fiscal.

In a separate interview with the publication, another economic commentator Wendy Mpofu said:

By announcing monetary policy measures, the Treasury is creating confusion in the market as announcements of such is the prerogative of the RBZ.

Once that happens it also works against the restoration of confidence in the financial market.

Meanwhile, International Monetary Fund (IMF) has urged Zimbabwe to fully liberalise the foreign-exchange market to allow the rate to be determined by market forces.

More: Pindula News

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17 Comments

Dhongi · 1 year ago
Ma1
Putin 🇷🇺🇷🇺🇷🇺🐊🐊🐊 · 1 year ago
nyika inotongwa nevene vayo hallelujah hallelujah hallelujah 🇿🇼#ED
fugu pfeee · 1 year ago
Ameeeen
Putin 🇷🇺🇷🇺🇷🇺🐊🐊🐊 · 1 year ago
@Hondo udza baba vako uone kuti haurohwe here , sorry sekuru vako baba vako vaive chanana nguva iyoyo
@ᴋɢᴏsɪ ᴅᴇ_ʀɪᴄᴄʜ💖 · 1 year ago
#Zanu Pf is Zimbabwe #Zimbabwe is Zanu Pf #No to child abuse #Glory to Zanu Pf regime #Monarchial State #Time for Zanu Pf #One rulling party for Zimbabwe #Pasi na Nero #Ma comrade lets give them no room to sleep,rest #Long live Honourable ED Mnangagwa #Damage Control #Kgosi de_Ricch |Online journalist | Socialbrite #Honourable @Kgosi de_Ricch
eeeh ah ok · 1 year ago
Ndabamaningi Mangwana is a childish British nurse boy
Anonymous · 1 year ago
This used to happen during the Gono/Murerwa era Then it was Gono who was announcing both monetary and fiscal policies because he was close to the Head of State Hebert Murerwa was rendered useless as Minister of Finance and now it's Mangundya being rendered useless as the Central Bank chief
Hondo. · 1 year ago
Where is ZEC rig economy in favor of Zanu pf. Makuvata pabasa kkkkk
Hokage · 1 year ago
Pathetic!
Chaka · 1 year ago
I think Smith was better.
. · 1 year ago
He was so
78 is not the same thing · 1 year ago
but imagine zvazvodaitisati tavhota totochembera zvakangooma asiMwarikaaa
· 1 year ago
Mthuli is only taking a cue from ZANU which does not uphold the Constitutional Separation of Powers. This is why according to ZANU, there is no dividing line between Government and The State. Even within government ZANU doesn't know the difference between government and party functions, which is why we now have a situation where some civil servants, notably George Charamba and Ndabamaningi Mangwana speaking as though they are party functionaries. This is why we have Judicial capture. This is why we have the militarization of politics. This is why we have a partisan Police. This is why we have the party abusing state resources. As a result we have no accountability. We have no checks and balances. No wonder the country has institutionalised corruption.
Mohammed Zaka ali · 1 year ago
kkkk vanhu vekuzvikoro
ted · 1 year ago
unoziva zvisingaziviwe nevakawanda
.... · 1 year ago
Well said 👏

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