Why ZiG currency stability is continuing

Zimbabwe’s gold-backed ZiG remains stable in 2025, supported by tight monetary discipline, strong reserves, improved exports and growing market confidence (image source)

Zimbabwe’s gold-backed currency, the ZiG (Zimbabwe Gold), has maintained notable stability through 2025, buoyed by tighter monetary controls, disciplined fiscal management and growing confidence in the reserve-backing framework introduced earlier this year. The Reserve Bank of Zimbabwe (RBZ) attributes the continued steadiness to robust foreign-exchange inflows, stronger mineral and agricultural exports, and a clear link between money supply and physical reserves of gold and other minerals. Inflation has eased into single digits, while the interbank exchange rate has remained relatively flat for three consecutive quarters—an outcome that has surprised many analysts who expected early volatility. “Stability is fragile but real for now; sustaining it requires continued reserve accumulation and restraint on quasi-fiscal operations,” said a Harare-based macroeconomist.

Policymakers credit a combination of reforms: limiting unbacked credit creation, tightening government spending, and publishing periodic reserve audits to build public trust. The RBZ says the currency’s convertibility into physical gold through authorised dealers has reinforced confidence among exporters and high-value traders, while easing speculative pressures on the parallel market.

Economists view the ZiG as a cornerstone of Zimbabwe’s post-hyperinflation recovery strategy, offering businesses a predictable pricing environment and restoring some investor confidence. Exporters in tobacco, lithium and platinum sectors have benefited from smoother repatriation processes and improved value retention, while urban consumers have welcomed greater price stability in basic goods.

However, analysts caution that the foundations remain delicate. Sustaining the ZiG’s strength will depend on disciplined fiscal conduct, transparency in reserve management, and deepening of the interbank foreign-exchange market. Structural issues—including limited manufacturing output and dependence on primary commodities—continue to pose medium-term risks. Stable currency conditions improve the cost of doing business, enable longer-term contracts, and provide a platform for investment planning. For small enterprises and households, exchange-rate calm translates into more predictable prices and reduced transaction risk.

Still, experts warn that maintaining credibility will require political restraint. Any resurgence of quasi-fiscal activities, election-related spending or delayed exporter settlements could quickly erode trust. As one banker observed, “Monetary stability is earned daily—the moment discipline slips, the market reacts.”

For now, the ZiG’s performance signals cautious optimism: a period of stability that, if preserved, could anchor Zimbabwe’s broader economic recovery and restore investor confidence in the nation’s monetary governance.