The two downloadable documents below are:
- A three-page summary kindly provided by the Reserve Bank of Zimbabwe entitled 2023 Mid-Term Monetary Policy Statement at a Glance; and
- The complete Mid-Term Monetary Policy Statement 2023.
SECTION ONE: INTRODUCTION AND BACKGROUND
1. This Mid-Term Monetary Policy Review Statement (the Statement) is issued at a time when the economy is on the right track toward sustained price and exchange rate stability. The measures in this Statement are, therefore, primarily aimed at ensuring that the country stays on course or continues to hold on to the right path of the progress that it has attained on the price and financial stability fronts. Precisely, the Statement, which is issued in terms of Section 46 of the Reserve Bank Act [Chapter 22:15], will evaluate the monetary policy stance and policies pursued by the Bank in the past six months ended 30 June 2023 and outline the monetary policy stance to be pursued by the Bank in the next six months.
2. The country experienced significant exchange rate depreciation between April and June 2023 driven by both demand and supply factors, which exerted significant pass-through to inflation. The demand factors mainly reflected elevated demand for foreign currency for store-of-value purposes. The effect of the high demand for foreign currency on the economy was coupled with the sudden decline in the demand for local currency due to speculative behaviour, including exchange rate indexation at excessively undervalued or over-depreciated exchange rates. In addition, supply factors emanating from a transitory decline in foreign currency receipts on account of declining export commodity prices such as the Platinum Group of Metals (PGMs). The adverse supply trends have, however, since reversed.