Online Reporter
Tapiwanashe Mangwiro
Zimbabwe’s economy is reaping significant benefits from the sustained rally in global gold prices, which has driven growth of foreign currency reserves and strengthened the central bank’s capacity roll out initiatives to support exchange rate stability.
Gold prices touched new record highs, benefiting from strong global demand as a haven asset, amid geopolitical tensions and growing uncertainty from US President Donald Trump’s hostile trade policies.
The downbeat global sentiment among investors, businesses and analysts has boosted Zimbabwe’s foreign currency reserves, underpinning the durable stability of the ZiG currency. which was introduced in April 2024.
Enhanced foreign currency availability and higher forex reserve holdings enable the RBZ to maintain a functional, market-determined exchange rate and reduce reliance on the parallel market, which can exert pressure on the exchange rate.
Zimbabwe’s structured ZiG currency is backed by gold and foreign currency. Through 2025, the domestic unit of account traded around 26,7/US$1 while the parallel market premium reduced from over 100 percent to less than 20 percent.
The durable stability of the ZiG currency has helped tame previously rampant inflation and exchange rate instability, boosting investor and public confidence, enhancing predictability and enabling long-term planning.
Last week, international bullion prices breached the US$5 000 price level and under the Finance Act No. 7 of 2025, the price level triggers a 5 percent royalty rate, channelling more revenue to state coffers per ounce traded.
RBZ Governor Dr John Mushayavanhu, in an interview on Friday, confirmed that the current gold prices had markedly accelerated reserve accumulation, resulting in significant positive spinoffs on the economy and gold-backed domestic currency.
“The increase in the gold price is resulting in an increase in gold reserves at the Reserve Bank as new gold deliveries substantially increase in response to the higher prices,” Dr Mushayavanhu said.
The RBZ said gold reserves had swelled from US$484,8 million in 2024 to US$1,2 billion by the end of 2025. This fortified reserve base is the bedrock of Zimbabwe’s macroeconomic turnaround.
“As such, the total amount of gold reserves held by the Reserve Bank increased substantially from US$484,8 million in 2024 to US$1,2 billion as at the end of 2025,” Dr Mushayavanhu said. He noted that elevated prices also result in valuation gains on existing reserves.
“Higher reserve holdings by the Reserve Bank have strengthened the bank’s capacity to sustain exchange rate stability, support market liquidity and enhance the country’s resilience to external shocks, signalling a positive shift in Zimbabwe’s macroeconomic outlook,” he said.
The stability has directly fed into rapid disinflation, with inflation dropping to a single-digit 4,1 percent in January 2026. Furthermore, the high gold price has transformed trade balances, with the country consistently recording strong trade surpluses, peaking at an estimated US$220 million in late 2025.
The historic price levels provide powerful incentives for miners to expand production, promising continued gains for the sector and the national treasury. This golden rally is now central to Zimbabwe’s prospects for lasting economic stability and growth.
