Central Bank says money market slowly shifting to normalcy

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Central Bank has said that the money market that proved volatile over the last   weeks is showing signs of normalcy after the bank took stun measures against the speculators.

By end of Friday, the Dollar was selling at Rwf 755 showing stability for two weeks after it was pushed to Rwf800 in late July which was caused by Speculators according to Central Bank.

The bank says that the market now has steady inflows as well as stable prices, which indicates normalcy in the economy.

“The market is getting inflows and prices are stable in Commercial Banks,” said Doreen Makumi, a communication expert with the Central bank in a interview with this website.

This  Makumi says was after the  Bank  took  stun  measures cot  penalize   some of the bureaus  that   had  speculated to push the Dollar to rwf 800 which resulted into  a sharp  depreciation of the local  currency (Francs).

This resulted into price increase of most imported products such electronics, raw materials for brewery among others impacting further on the country trade deficit that stands at 6.5 percent in the first quarter, 2015.

But the market is still showing limited supply mainly in evening hours where some forex bureaus are not willing to sell out the Dollar, something experts say can likely spur the black market.

“Banks have not raised this issue, only some bureaus are still showing the speculative behaviors,” Makumi said.

 Moreover, most people have been moving to Borders of Gatuna and Rusizi to buy dollars and later trade them illegally, raising more speculations in the market.

 However, Central bank says is aware of the issue and has already acted on it with Makumi further assuring that “the Central Bank will continue to work on these malpractices.


About the author

Olive Ndaka is the Junior Editor for RwandaEye. An investor and young entrepreneur, she is a quick learner and has contributed many articles for RwandaEye in Kinyarwanda.

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