The Reserve Bank of Zimbabwe (RBZ) asserts that its new gold-backed currency, the Zimbabwe Gold (ZiG), is fully backed by more than 100% in reserves—including 2.5 tons of gold and $100 million in foreign assets. Introduced last year as the country’s sixth currency attempt in 15 years, the ZiG aims to curb rampant inflation and restore trust in Zimbabwe’s troubled monetary system.
Despite these assurances, many Zimbabweans continue to rely heavily on the U.S. dollar for daily transactions, reflecting deep-rooted skepticism following decades of hyperinflation and economic instability. The International Monetary Fund (IMF) has expressed support for the ZiG’s potential to become Zimbabwe’s full national currency, but uptake remains limited.
According to Reuters, the RBZ held its benchmark interest rate steady at 35% on Monday, citing exchange rate stability. The central bank also reported total reserves of $701 million and highlighted a rise in ZiG transactions to 43% in May from 26% in April, shortly after the currency’s launch.
However, credibility issues persist. The ZiG continues to trade below the official rate on the parallel market, indicating ongoing mistrust despite the central bank’s claims of full reserve backing. Zimbabwe’s history of abrupt currency changes and hyperinflation has left many investors and consumers cautious.
Reserve Bank Governor John Mushayavanhu reaffirmed commitment to the ZiG’s success, emphasizing the bank’s focus on sound monetary principles. “ZiG is our national currency, and we are committed to ensuring its success by maintaining all the fundamental characteristics of sound money, including its function as a reliable store of value,” Mushayavanhu stated.
Finance Minister Mthuli Ncube also expressed optimism, linking ongoing monetary reforms to securing $2.6 billion in bridge financing by mid-2026.
Yet global investor confidence remains low. Jetro Siekkinen of LGT Capital Partners told Reuters, “We wouldn’t invest in Zimbabwe at the current stages. The country needs to have a lot more development before we would consider it.”
Analysts warn Zimbabwe’s reserve position is weak, with only 0.8 months of import cover—well below the IMF’s recommended three-month minimum. Concerns persist about gold reserve transparency, limited currency convertibility, persistent inflation, and a thriving black market that keeps the U.S. dollar dominant.
Without greater policy credibility and transparency, the ZiG’s future as Zimbabwe’s stable national currency remains uncertain.
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