Latest news with #ZimbabweGold
Business Insider
4 days ago
- Business
- Business Insider
Foreign investor interest in Zimbabwe stocks climbs to multi-year highs
The growth reflects renewed investor interest amid improving economic fundamentals and the relative stability of the Zimbabwe's new gold-backed currency. Foreign participation in Zimbabwe's stock market increased significantly in Q2 2025, reaching 26.53% of total trades. Trades in value terms surged 153.94% to ZiG 743.6 million ($27.7 million) due to investor confidence. Introduction of Zimbabwe's gold-backed currency, ZiG, supported economic stability and trade improvement. Foreign participation in Zimbabwe's stock market climbed sharply in the second quarter of 2025, reflecting renewed investor interest amid improving economic fundamentals and the relative stability of the country's new gold-backed currency. According to the Zimbabwe Stock Exchange (ZSE)'s latest quarterly newsletter, foreign investor activity rose to 26.53% of total trades in Q2, up from 15.39% in the previous quarter. In value terms, foreign trades jumped 153.94% to ZiG 743.6 million ($27.7 million), compared to ZiG 292.8 million in Q1. While these figures remain below the over 40% participation seen in the early 2010s, they mark a notable rebound following years of capital flight driven by policy unpredictability, runaway inflation, and currency instability, according to Reuters. Gold production boosts confidence The renewed interest follows the April launch of the Zimbabwe Gold (ZiG), a new currency backed by gold reserves and other foreign assets, which has so far held its value. 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 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. Authorities now hope the gold-backed ZiG will eventually take over from the US dollar, which has served as a parallel currency in the country since 2009. The International Monetary Fund (IMF) also 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. However, the Fund continues to urge authorities to maintain strict fiscal and monetary discipline. Total market turnover on the ZSE increased 53.14% in Q2 to ZiG 1.49 billion, with the top five listed companies accounting for over 86% of equity turnover and 81% of total turnover. Despite the increase in trading activity, the total market value dipped 3.08% to ZiG 62.64 billion, and the ZSE All Share Index fell 3.91% to close the quarter at 197.23 points. Meanwhile, on the Victoria Falls Stock Exchange (VFEX), a U.S. dollar-denominated bourse designed to attract offshore capital, turnover reached $15 million during the quarter. However, market capitalisation edged down to $1.25 billion from $1.29 billion in Q1. Average foreign participation on the VFEX stood at 18.73%.
Business Insider
09-07-2025
- Business
- Business Insider
Gold and forex reserves supporting Zimbabwe's ZiG hit all-time high
Gold and foreign-currency reserves supporting Zimbabwe's bullion-backed currency, the ZiG (Zimbabwe Gold), hit a record high in June, according to the central bank. Zimbabwe's central bank reported record-high gold and foreign currency reserves, reaching $731 million in June. The ZiG currency experienced its largest single-day gain against the U.S. dollar due to increased gold production and reserves. The ZiG was introduced to replace the defunct Zimbabwean dollar, addressing past economic instability caused by previous currency collapses. Gold and foreign-currency reserves supporting Zimbabwe's bullion-backed currency, the ZiG (Zimbabwe Gold), hit a record high in June, according to the central bank. The reserves rose to $731 million last month, up from $639 million in May and significantly higher than the $276 million reported in April 2023, when the ZiG was first introduced. The update was shared in a statement released by the central bank on Wednesday. This week, 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. A new chapter after currency failures Years of economic mismanagement have led to the collapse of five previous attempts to establish a stable currency in Zimbabwe, according to Bloomberg. The ZiG, introduced to replace the defunct Zimbabwean dollar, which had plummeted in value, is the latest effort. 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 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. Authorities now hope the gold-backed ZiG will eventually take over from the US dollar, which has served as a parallel currency in the country since 2009. The International Monetary Fund (IMF) also 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.
Bloomberg
09-07-2025
- Business
- Bloomberg
Zimbabwe Currency Reserves Backing ZiG Climb to Record
Gold and foreign-currency reserves backing Zimbabwe's bullion-linked monetary unit rose to a record in June, the central bank said. The reserves climbed to $731 million from $639 million in May and $276 million in April last year, when the nation introduced Zimbabwe Gold, the currency known as the ZiG, the central bank said in a statement Wednesday.
Zawya
20-06-2025
- Business
- Zawya
Zimbabwe says gold-backed currency stable but investor doubts persist
Zimbabwe's gold-backed currency now has more than 100% reserve cover and is stable, according to the central bank, but doubts over its credibility remain, underscored by a persistent premium in the parallel market. The Reserve Bank of Zimbabwe on Monday, 16 June 2025 kept its benchmark rate unchanged at 35%, citing a stable exchange rate as one of the reasons, and reported total reserves of $701m. The bank said the portion of transactions carried out using the Zimbabwe Gold (ZiG) currency surged to 43% in May from 26% in April 2024, the month it was introduced. Decades of economic instability and currency devaluations mean most people still use the US dollar for most purchases. But the authorities are hoping the ZiG's gold backing will give Zimbabweans the confidence to adopt it for everyday transactions. "ZiG is our national currency, and as the central bank, we are committed to ensuring its success by maintaining all the fundamental characteristics of sound money, including its function as a reliable store of value," Reserve Bank Governor John Mushayavanhu said. "The Reserve Bank has learned from previous currency failures that maintaining optimum money supply and ensuring monetary stability is vital," he added. Despite the bank's assurances, the gap between the official exchange rate and parallel market rate remains about 20%. "The rate has been stable for more than three months," said black-market trader Pearson Tambudze, attributing the stability to a scarcity of the local currency rather than restored confidence. "There isn't a lot of ZiG in the market," he said. The International Monetary Fund has welcomed the ZiG's stability but is urging Zimbabwe to adopt tighter money-growth limits, a more transparent foreign exchange market and to make progress on clearing an estimated $12.2bn in external arrears. Finance Minister Mthuli Ncube, meanwhile, expressed hope last month that currency stability and appropriate monetary policy would enable Zimbabwe to raise $2.6bn in bridge finance by mid-2026. Investors, however, remain cautious. "We wouldn't invest in Zimbabwe at the current stages. The country needs to have a lot more development before we would consider it," said Jetro Siekkinen at LGT Capital Partners. Economists also flagged concerns over Zimbabwe's reserve cushion, which stands at 0.8 months of import cover, well short of the IMF's recommended three-month safety net. "In terms of priority, I would consider the clearance of arrears with multilateral creditors to be most important," said Lyle Begbie, an economist at Oxford Economics. Two earlier IMF staff-monitored programmes collapsed within 15 months, and Begbie predicted similar outcomes for future efforts. "Ultimately, we are likely years away from the IMF providing concessional financing to Zimbabwe, even if the country does everything right, which itself is not likely," he said.
The Star
19-06-2025
- Business
- The Star
Zimbabwe boosts gold reserves to 3.4 metric tons to support ZiG currency
HARARE, June 19 (Xinhua) -- Zimbabwe is steadily building its gold reserves to support the Zimbabwe Gold (ZiG) currency introduced in April last year, with reserves now standing at 3.4 metric tons, the Presidential Communications Department said Thursday. In a post on X, the department said President Emmerson Mnangagwa toured the gold vaults of the Reserve Bank of Zimbabwe (RBZ) on Thursday. The RBZ plans to increase national gold reserves to 5 metric tons by the end of this year. In his address to the media after the inspection, Mnangagwa said the reserves are critical, serving as one of the key fundamentals needed for a stable national currency. RBZ Governor John Mushayavanhu said the current gold reserves held by the central bank are more than sufficient to back the ZiG in circulation. He said the ongoing stability of the local currency is a result of rising reserves and sound fiscal policies. The ZiG, launched last April as Zimbabwe's latest attempt at currency reform, has remained largely stable in recent months due to the central bank's tight monetary policy stance. On Wednesday, the International Monetary Fund praised Zimbabwe's macroeconomic stability, noting that the country's disciplined policies have helped stabilize the ZiG and reduce inflation.
