Online Reporter
Business Reporter
THE Willing-Buyer Willing-Seller (WBWS) interbank market exchange rate remained stable, averaging around ZiG25,93 per US$ from January to July 2026, while the parallel market exchange rate premium continued to narrow to levels of about 15 percent during the first seven months of 2026.
Presenting the 2026 Mid-Term Monetary Policy earlier today, Reserve Bank of Zimbabwe Governor Dr John Mushayavanhu said the exchange rate stability continued to be supported by improved foreign exchange inflows, accumulation of foreign currency reserves backing ZiG and strategic intervention in the foreign exchange market to ensure all bona fide foreign obligations are settled.
“Foreign currency reserves stood at US$1,7 billion as at end July 2026, equivalent to 1,7 months of import cover. The growth in foreign currency reserves was supported by royalties in-kind from precious minerals and the channelling of a 5 percent portion from the 30 percent export surrender requirements towards reserves build-up.
“At 1,7 months’ import cover, the foreign currency reserves adequately covered the entire ZiG deposit base by almost 1,5 times as at end of July 2026 and the stock of reserve money by 6 times,” Dr Mushayavanhu said.
Inflation Developments
Coupled with the Reserve Bank’s prudent monetary policy, exchange rate stability has helped anchor low ZiG annual inflation, which was sustained below 5 percent during the first half of 2026.
The prevailing low and stable inflation environment has supported greater predictability and certainty, critical for business planning, investment and inclusive growth,” Dr Mushayavanhu said.
Annual ZiG inflation increased from 4.1 percent in January 2026 to 4.8 percent in April 2026, driven mainly by the increase in fuel prices, before reverting to its pre-shock path in May 2026.
The moderate increase in annual inflation in April 2026 reflected more well-anchored inflation expectations.
Annual ZiG inflation stood at 3,2 percent in July 2026, on account of the decline in fuel prices in June 2026 and stability of the ZiG/US$ exchange rate.
The significant decline in annual inflation from 4.7 percent in June 2026 to 3,2 percent in July was also explained by the favourable base effect, reflected in the slowdown in monthly inflation in July 2026 to 0,1 percent, compared to 1,6 percent recorded in the same month in 2025.
