Online Reporter
Golden Sibanda
Business News Editor
ZIMBABWE has made huge strides towards durable ZiG price stability, the Confederation of Zimbabwe Industries (CZI) has said, with the central bank keeping inflation below 1 percent since February.
The ZiG month-on-month inflation slightly decreased to 0,3 percent in June from 0,9 percent recorded in May, Zimbabwe’s most influential industrial lobby noted in its Currency and Inflation Developments report released earlier this month.
The Reserve Bank of Zimbabwe (RBZ) is targeting a monthly inflation rate of below 3 percent for 2025, consistent with exchange rate stability.
The target is part of the central bank’s broader strategy to maintain price stability in Zimbabwe’s multi-currency environment. CZI said the low monthly inflation was critical to engender renewed market confidence in the domestic unit of account.
“The prolonged period of inflation at rates below 1 percent since February generally reflects a ZiG price-stabilising economy. In addition, this may also indicate the success of monetary policy in restoring price discipline as compared to past experiences with the Zimbabwean dollar,” CZI said.
The central bank announced last week that it was now holding more than US$731 million in foreign currency reserves backing the domestic unit, as of June 25, 2025.
The RBZ said the foreign currency reserves, equivalent to ZiG19,67 billion, were enough to cover all the ZiG reserve money of ZiG4,7 billion and the entire local currency deposits of ZiG17,3 billion.
“The foreign reserves were to cover both ZiG reserve money and the entire stock of ZiG deposits as at end-June 2025. The build-up of foreign currency reserves is critical for the lasting stability of the
ZiG currency,” the RBZ said in its second quarter snapshot on monetary, currency, price and financial developments last week.Complemented by a tight monetary and fiscal policy stance, the ZiG has remained largely stable since its introduction last year, resulting in a marked drop in the premium between the parallel market and official exchange rates.
“Low levels of inflation will help build trust in the currency, which might also encourage greater usage of ZiG in transactions. This could also boost the likelihood of a gradual de-dollarisation process leading to a ZiG monocurrency regime by 2030,” CZI said.
The ZiG year-on-year inflation rate slightly increased to settle at 92,5 percent in June, the industrial lobby group noted, after gaining 0,4 percentage points from 92,1 percent recorded in May 2025.
CZI said while the month-on-month inflation had shown that price increases were currently under control, the high annual inflation rate reflected historical price instability legacies whose effects were still at play.
