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IMF says gold coins missed chance to build Zimbabwe reserves
23 Sep 2022 at 05:57hrs | Views
The gold coins that have been in circulation in Zimbabwe for almost three months are a missed chance to build the nation's gold reserves, according to the International Monetary Fund.
"The sale of gold coins has contributed to withdrawing Zimbabwe dollar liquidity from the market, though it represents an opportunity cost in terms of foregone reserves for the Reserve Bank of Zimbabwe," an IMF spokesperson said Thursday in an emailed response to Bloomberg questions.
John Mangudya, the central bank governor, didn't immediately respond to calls to his mobile phone seeking comment.
The central bank plans to sell smaller denominations of the so-called "Mosi-oa-Tunya" gold coins, named after Victoria Falls, from November. The smallest, a tenth of an ounce, will be made available to the public through banks and approved dealers. A regular-size one is selling for $1,755, according to data available Thursday on the central bank's website.
The coins are widely credited with helping halt the decline in the parallel market rate for the Zimbabwe dollar. That's allowed it to converge with the official rate, which has plunged more than 80% against the US currency this year.
Gold output in the southern African nation surged 41% in the first eight months of the year to 22,290 kilograms from a year earlier. The country aims to produce 35 tons of bullion in 2022.
"The sale of gold coins has contributed to withdrawing Zimbabwe dollar liquidity from the market, though it represents an opportunity cost in terms of foregone reserves for the Reserve Bank of Zimbabwe," an IMF spokesperson said Thursday in an emailed response to Bloomberg questions.
John Mangudya, the central bank governor, didn't immediately respond to calls to his mobile phone seeking comment.
The central bank plans to sell smaller denominations of the so-called "Mosi-oa-Tunya" gold coins, named after Victoria Falls, from November. The smallest, a tenth of an ounce, will be made available to the public through banks and approved dealers. A regular-size one is selling for $1,755, according to data available Thursday on the central bank's website.
The coins are widely credited with helping halt the decline in the parallel market rate for the Zimbabwe dollar. That's allowed it to converge with the official rate, which has plunged more than 80% against the US currency this year.
Gold output in the southern African nation surged 41% in the first eight months of the year to 22,290 kilograms from a year earlier. The country aims to produce 35 tons of bullion in 2022.
Source - Bloomberg News
