Gold’s recent rally, combined with a steady build-up of foreign-exchange reserves, has given Zimbabwe’s bullion-backed currency a welcome boost, helping it recover most of the ground it lost against the US dollar earlier this year.
The ZiG, short for Zimbabwe Gold, strengthened to 25.98 per dollar, its strongest level since 8 January 2025, according to data reported by Bloomberg. The move reflects renewed confidence in the currency’s underlying support at a time when global gold prices remain elevated.
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Since its introduction in April 2024, the ZiG has depreciated by just 0.7 percent against the dollar in 2025. That performance stands in sharp contrast to the extreme volatility that has historically defined Zimbabwe’s currency market.
Unlike previous iterations of the local unit, the ZiG is backed by tangible assets. The Reserve Bank of Zimbabwe (RBZ) says the currency is supported by around 2.5 tonnes of gold and approximately US$100 million in foreign-currency reserves. Analysts say this backing has helped stabilise expectations and reduce speculative pressure.
Zimbabwe’s long road to currency stability
The ZiG represents Zimbabwe’s sixth attempt in 15 years to establish a functional and trusted local currency. Earlier efforts collapsed amid hyperinflation that, at its worst, saw prices doubling almost daily, destroying savings and eroding public trust.
In 2009, the country effectively abandoned its national currency and adopted a multi-currency system dominated by the US dollar, ushering in a long period of dollarisation. While that move brought price stability, it also limited monetary policy flexibility and constrained liquidity.
Despite the ZiG’s relatively stable debut, its circulation remains limited. The US dollar continues to dominate daily transactions, with large companies such as Delta Corporation reporting that roughly 80 percent of sales are still conducted in foreign currency.
Still, the recent strengthening of the ZiG suggests that higher gold prices and disciplined reserve accumulation are giving the currency some breathing space. Whether that stability can translate into broader acceptance across the economy will depend on consistent policy, confidence in convertibility, and continued transparency from monetary authorities.
