Zimbabwe's ZiG posts biggest gain yet on soaring gold reserves

Business Insider

2 days ago

Zimbabwe's gold-backed currency, the ZiG, recorded its biggest single-day gain against the U.S. dollar this year.
Zimbabwe's gold-backed currency, the ZiG, has seen its largest single-day gain against the US dollar this year by 0.2%, trading at 26.89 per dollar.
This appreciation is supported by a 46% increase in gold production in the first half of the year, with 20,104 kilograms produced.
This surge in gold output has significantly increased Zimbabwe's foreign reserves, enhancing the financial stability of the ZiG.
Zimbabwe's gold-backed currency, the ZiG, recorded its biggest single-day gain against the U.S. dollar this year, buoyed by a sharp increase in gold production and stronger foreign currency reserves.
The ZiG appreciated by 0.2% on Friday, trading at 26.89 per dollar, according to data published on the Reserve Bank of Zimbabwe's website. It marked only the 12th time the currency has strengthened against the dollar in 2025, according to Bloomberg.
The boost comes as gold production rose nearly 46% in the first half of the year to 20,104 kilograms, according to Fidelity Refineries, the country's sole gold refinery. June alone saw a 63% year-on-year surge in output.
This increase in bullion output has helped triple Zimbabwe's foreign reserves, offering a much-needed buffer for the country's fledgling currency and economy, the central bank said.
The Reserve Bank of Zimbabwe last month reported that it now holds 3.4 tons of gold in its reserves, more than double the 1.5 tons it had in storage when the ZiG currency was first introduced in April last year.
IMF expresses cautious optimism
Last month, the International Monetary Fund (IMF) expressed support for the ZiG, stating that it hopes to see the currency evolve into Zimbabwe's sole legal tender under a potential staff-monitored program.
The currency is Zimbabwe's sixth attempt in 15 years to establish a stable local currency, and it is backed by 2.5 tons of gold and $100 million in foreign currency reserves held by the central bank.
However, despite its gold backing, the ZiG has struggled to win the public's trust.