Zimbabwe To Introduce Smaller Gold Coins
The Reserve Bank of Zimbabwe (RBZ) has delivered good news for ordinary Zimbabweans looking to buy gold coins.
RBZ governor Dr John Mangudya said gold coins, as small as a tenth of an ounce will go on sale in November. Mangudya said Zimbabwe’s central bank will introduce half ounce, quarter ounce and tenth ounce coins
The smallest gold coin will weigh just over 3,11g of gold and will cost US$188,48, or local currency equivalent at the interbank rate, at one-tenth of the previous day’s price of the one ounce Mosi-oa-Tunya.
The actual price when it is introduced will be the world price of gold for one-tenth of a troy ounce plus 5 percent minting and distribution fee.
Banks have so far sold 4 475 Mosi-oa-Tunya coins since the launch on July 25. Ninety percent of the gold coins were bought in local currency totalling close to $4 billion.
In his Mid-Term Monetary Policy statement released on Thursday, Dr Mangudya said the RBZ would be releasing smaller gold coins in mid-November to allow more buyers. He said:
Following the successful launch of the gold coins on July 25 2022 and in response to public demand, the bank shall introduce and release into the market gold coins in smaller units of a tenth ounce, quarter ounce and half ounce for sale with effect from mid-November 2022
The gold coins have not been met with enthusiasm with former Zimbabwe Deputy Prime Minister Professor Arthur Mutambara describing them as “a self-enrichment scheme for the elites.”
In a scathing critique on social media, the former deputy prime minister wrote,
Gold Coin: A Self-Enrichment Scheme for the Elites
Take your USD to the parallel market and get RTGS at, say, 1 USD to 950
Buy gold coins in RTGS at 1 USD to 441 (gold coin exchange rate) and make a profit of more than 100%
The Gold Coin arbitrage
This is common sense.
Gold Coin & the Elites
It gets worse!
For the elites; you take your RTGS to the RBZ and buy USD at the auction rate, say 320
You take this ill-gotten USD to the parallel market and buy RTGS at 950
That is a profit of 200%
Then go and buy your gold coins at 100% profit.
From 10K USD to 60K USD (With no Production)
500% Profit for the Elites
Take 10k USD to the parallel market and buy RTGS at 950
Go to the RBZ & buy USD at 320 (auction rate)
Go back to the parallel market & buy RTGS at 950
Buy gold coins & pay in RTGS.
It is shameful.
The post Good News For Average Zimbabweans As RBZ Introduces Smaller & Cheaper Gold Coins appeared first on iHarare News.