Introduction of Foreign Exchange Swaps as Instruments of Monetary Policy

BANX. of ZAMBIA
OFFICE OF THE DEPUTY GOVERNOR - OPERATIONS
July 25, 2013
CB Circular No: 15/2013
To All Heads of Commercial Banks
INTRODUCTION OF FOREIGN EXCHANGE SWAPS AS INSTRUMENTS OF MONETARY POLICY In our continued effort of enhancing the efficacy of our monetary policy operations as well as nurturing our domestic financial markets, the Bank of Zambia wishes to announce the introduction of foreign exchange swaps (FX swaps) as an additional instrument of monetary policy under our Open Market Operations (OMO). The primary purpose of introducing the FX swaps is to increase the number of instruments in the toolkit available to the Central Bank to assist improve the liquidity management effort in the money markets. Kindly note that the introduction of FX swaps is with immediate effect. We wish to advise that the rules and procedures governing FX swaps are contained in the OMO Guidelines which will be issued soon. /:
Bw Iya K. E. Ng'andu (Dr)
DE UTY GOVERNOR - OPERATIONS
Bank Square, Cairo Road P.O. Box 30080, Lusaka, Zambia Tel: 260-211-226844,228888 Fax:260-211-237070 E-mail: bngandu@boz.zm. bttp:/Iwww.boz.com