Sustained Depreciation: Zimbabwe Gold (ZiG) has recorded a prolonged depreciation trajectory against the USD, reaching historic lows
Structural Devaluation: A 43% government-administered devaluation in September 2024, driven by monetary overhang and reserve-supply imbalances, exacerbated erosion of ZiG-denominated asset values
2025 Depreciation Forecast: The 2025 fiscal budget projects a 52% year-on-year ZiG depreciation, with an average exchange rate of 36.00 per USD
Harare- The Zimbabwe Gold (ZiG) has demonstrated sustained depreciation against the United States Dollar (USD), recording an exchange rate of 26.6749 on 17 March 2025, extending a loss-making streak observed since the commencement of the month.
The currency registered its nadir on 12 March 2024, closing at 26.6704 its weakest valuation since the historic trough of 22 January 2024.
A transient marginal appreciation to 26.66 (rounded to 26.67) provided brief respite over two sessions, though this still represented a record low relative to the January 2025 benchmark.
ZiG, legislated as legal tender in Zimbabwe effective 5 April 2024, operates within a multi-currency framework adopted in 2020 to mitigate hyperinflationary pressures.
Preceding monetary iterations include the 2016 issuance of Bond Notes, nominally pegged at a 1:1 parity with the USD to incentivise exporters and provide smaller denominated notes, and the 2019 introduction of the Real Time Gross Settlement (RTGS) system, later rebranded as the Zimbabwe Dollar (ZWL).
These antecedent currencies were characterised by structural deficiencies, including absence of macroeconomic fundamentals, fiscal indiscipline, and confidence deficits, a pattern replicated with ZiG.
Despite being theoretically collateralised by gold reserves, its credibility was prematurely undermined by monetary overhang via excessive liquidity injections, distorting demand supply equilibrium.
By July 2025, ZiG’s money supply had doubled relative to reserve holdings, precipitating a parallel market premium of 100%.
This monetary disequilibrium necessitated a 43% administered devaluation on 26 September 2025, eroding nominal values of ZiG-denominated assets for corporates and households.
Such policy volatility has perpetuated currency substitution behaviour, with economic agents prioritising USD holdings to hedge against devaluation risk, exacerbating downward pressure on the ZiG.
Presently, the ZiG trades at 34.00 in the informal market, narrowing the spread toward convergence with formal rates.
Despite nominal stability on official platforms, the currency has exhibited a persistent upward trajectory (denoting depreciation) since January 2025 without meaningful correction.
In the 2025 fiscal budget, the Minister of Finance, Economic Development, and Investment Promotion, Professor Mthuli Ncube, issued forward guidance anticipating a 52% year-on-year depreciation with a projected mean exchange rate of 36.00 per USD, signalling latent risks of further structural devaluation.
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