IMF tells Zimbabwe to end RBZ’s quasi-fiscal activities – Bulawayo24 News (10/26/23)
The International Monetary Fund (IMF) has implored Zimbabwe to end the central bank’s quasi-fiscal activities among a raft of reforms to “fully restore macroeconomic stability”.
The Reserve Bank of Zimbabwe (RBZ) stands accused of engaging in activities that are supposed to be done by the Treasury.
Quasi-fiscal activities were blamed for fuelling hyperinflation in the period 2006 to 2008. This accelerated the depreciation of the local currency, paving the way for the introduction of the multi-currency regime in 2009.
In its report after an IMF staff visit in the period October 18 to 25, the global lender said economic policy reforms identified in previous Article IV consultations have not been implemented.
“First, comprehensively addressing the RBZ’s quasi-fiscal operations (QFOs) remains imperative to mitigate liquidity pressures and thus re-anchor inflation expectations. These measures should be complemented with an enhanced liquidity management framework, including through theuse of appropriate interest-bearing instruments by the RBZ to mop up excess liquidity,” IMF said.
RBZ has introduced gold coins and digital tokens to mop up excess liquidity in the market. The IMF has been against the issuance of gold coins and instead proposing the introduction of “appropriate interest-bearing assets”.
It said the consolidated fiscal stance, including QFOs, should be aligned with the short-term stabilisation objectives.
“Third, there is an urgent need to accelerate the FX market reform, by allowing more flexibility in the official exchange rate through a more transparent and market-driven price discovery; removing the restrictions on the exchange rate at which banks, authorised dealers, and businesses can transact; and further minimising export surrender requirements,” IMF said.
The RBZ said this week that it was removing the 10% trading margin above the interbank rate as it fine-tunes and further liberalises the foreign exchange market.
US speeds up defense system deployment in 7 countries including Iraq – Iraqi News (10/26/23)
Baghdad () – About a dozen air defense and missile defense systems will be deployed in Iraq, Syria and the Arabian Gulf this week amid an increase in attacks on US forces ahead of Israel’s ground operation in the Gaza Strip.
US officials said that the Pentagon sent the Terminal High Altitude Area Defense (THAAD) system to Saudi Arabia and Patriot air defense missile system battalions to Kuwait, Jordan, Iraq, Saudi Arabia, Qatar and the UAE, according to the Wall Street Journal (WSJ).
The sources explained that these systems will be deployed later this week.
“The deployment of the Terminal High Altitude Area Defense battery and the additional Patriot battalions that we announced this weekend is under way,” Pentagon Press Secretary Brigadier General Pat Ryder said in a press briefing on Tuesday.
The US Department of Defense revealed on Tuesday that US and coalition forces in Iraq and Syria were targeted at least 13 times last week.
The US Central Command mentioned that 24 US soldiers were injured last week in drone and rocket attacks on US bases in Iraq and Syria, indicating that all injuries were minor, NBC News reported.
The attacks are the first of their kind in more than a year.
With regional tension over the Israel-Hamas conflict increasing dramatically, Washington is on high alert for activities by groups backed by Iran.
Ryder also mentioned that US and coalition forces have been attacked at least 10 separate times in Iraq and three separate times in Syria between October 17 and October 24, via a mix of one-way attack drones and rockets.
The United States has about 900 soldiers in Syria and 2,500 soldiers in Iraq.
Source: Dinar Recaps
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