Friday, September 19, 2008

Forex rates compared

"Exchange rates appear to have been unsettled slightly by the conjectures that the Agreement we have all been waiting for might result in big inflows of foreign exchange. Hopes that such inflows would overcome the forex scarcity for a while seem to be fading as fast as the terms of the agreement are sinking in, but the Old Mutual share price did carry the OMIR down. I suspect that the hesitation will be brief.
There is a table that compares all the available rates since the beginning of August so that you can see how the Reserve Bank's managed inter-bank rate compares with those at work in the various "markets" but the distortions that apply to each of them are still forcing them to follow different tracks. The closest ties can be seen to be between the OMIR, the RTGS and the Parallel rates actually paid by importers. The cash rate would no doubt be higher if the Zim dollars to pay for the real money were not so scarce, and the HBEI might be lower if more eggs were on offer in the market and if chickes were not having to be fed on imported food! But it is a more modest number and certainly better than the inter-bank rate, which seems not to apply to anything..."

Kindest regards,

if you want a copy of the table please e-mail me at

No comments:

Post a Comment