The Reserve Bank of Zimbabwe (RBZ) Foreign Exchange Auction System closed first day of trading Tuesday at an average rate of ZW$57 for every US$1.
This was a source of relief on business players who had endured a fixed exchange rate on the interbank market.
A trading report for the day titled FX01/2020 released by the RBZ shows that the total amount allotted for the day was US$10.3 million against bids of US$11.4 million.
The highest bidding rate was ZW$100 whilst the least rate stood at ZW$25.50. However, the weighted average rate stood at ZW$57.35.
Out of the total trades from the available foreign currency, priority was given to raw material importers who were allowed to purchase US$2.8 million; machinery and equipment received US$2.4 million; food and beverages US$1.3 million and consumables covering importation of spares, tyres and packaging received US$1.2 million.
Other purposes like fuel, electricity, chemicals livestock and medicals got between US$436 000 and US$50 000.
The auction system announced by RBZ governor, John Mangudya last week aims to maintain a balance between stimulating productivity while eliminating reckless speculative behaviour which has seen rates at the parallel market escalate.
There will be an auction every Tuesday. Through their bank, a company or individual who wants forex, makes a bid for hard currency by 9 am on the day. Money to be auctioned will come from several sources. First are offshore facilities arranged by the central bank?
"The bidding platform shall be the Reuters Foreign Currency Auction system which shall be linked to the Computerised Export Payments Exchange control system and computerised export payments Exchange control Batch application system," Mangudya said.
Going forward shops will be required to display prices of goods and services in both US$ and in Zim dollar at the ruling auction rate for the week.