Online Reporter
The Zimbabwe Gold (ZWG) marked its first anniversary on Saturday.
Save for the turbulence the gold-backed tender hit late August last year that led to the central bank devaluing it on September 27 by 43 percent and a month or two that followed for it to find its footing again, the ZWG has generally been stable over the past 12 months.
Local currency inflation has been stable again in recent months as it was in the currency’s first four months last year. Prices rose by an average 0,5 percent in ZWG terms in February and -0,1 percent in March. This has helped moderate weighted inflation.
The currency has held its own at around 27 to the dollar on the formal market. On the street, it is trading at between 33 and 36 to the greenback.
Confidence in the local tender is increasing too especially in the formal market but the informal side is still trading in foreign currency.
We are encouraged by the performance of the ZWG since its launch and remain hopeful that the reason why it has performed that well — a tight monetary policy stance by the Reserve Bank of Zimbabwe — will be maintained well into the future.
“The Reserve Bank re-affirms its commitment to ‘walk the talk’ of consistent and prudent monetary policy management to sustain price, currency and financial stability,” said central bank Governor, Dr John Mushayavanhu in a release at the weekend.
“As such, the reserve bank will remain vigilant to any emerging domestic and external risk to inflation while simultaneously putting in place appropriate measures to strike the delicate balance between stability and economic growth. The obtaining low inflation and exchange rate stability anchored by prudent monetary policy management and other supportive measures will continue to be the guiding monetary policy frame work of the reserve bank.”
We look forward to the ZWG’s share of all transactions concluded in the economy growing and growing. That will be a strong indication of the transacting public gaining confidence in the note, ensuring that the Government achieves its de-dollarisation roadmap as initially scheduled.
Dr Mushayavanhu said that the central bank will issue new ZWG bank notes “in the shortest possible time.”
This is very good news for the transacting public, especially that segment which is unbanked that wants to have the physical ZWG in their hand instead of the US$ or the rand. Yes, digital money is convenient and is future-facing but there is a need for authorities to achieve a balance to embrace those of us who do not have a bank account, a mobile phone or computer.
