• Zimbabwe’s foreign currency receipts rose to US$16.2 billion in 2025, up from US$13.3 billion in 2024
  • Gold and tobacco were the dominant hard-currency earners, with gold prices near US$4,500/oz and tobacco exports exceeding US$1.3 billion following one of the largest crops in Zimbabwe’s history
  • Improved inflows supported ZiG stability and lower inflation, but forex reserves remain thin at about US$1.2 billion (1.5 months of import cover), leaving the economy exposed to external shocks

Harare - Zimbabwe earned US$16.2 billion in foreign currency receipts in 2025, up from US$13.3 billion in 2024, according to the latest foreign exchange update from the Reserve Bank of Zimbabwe (RBZ), with the improvement driven by record international gold prices, a bumper tobacco season, and resilient diaspora remittances.

                                                                                                                                     

The surge in hard-currency inflows has strengthened the central bank’s capacity to stabilise the Zimbabwe Gold (ZiG) currency, even as reserve adequacy remains below international comfort thresholds.

Mineral exports anchored by gold were the biggest contributors to foreign currency receipts accounting for circa 60% of total export earnings while international gold prices surged to around US$4,500 per ounce in 2025, significantly boosting export earnings and mineral-linked inflows.

A policy introduced in 2022 requiring miners to pay part of their royalties in physical gold continued to reshape Zimbabwe’s reserve profile. As a result, the country’s gold holdings increased to 4 tonnes, from 2.6 tonnes in December 2024, strengthening the asset side of the RBZ balance sheet.

While this accumulation has improved reserve composition, it has not yet translated into deep liquid buffers. Total reserves  combining gold and foreign exchange  stood at US$472 million in December 2024, highlighting the scale of balance-sheet expansion achieved over 2025 amid elevated bullion prices.

Beyond minerals, tobacco emerged also a standout contributor to foreign currency receipts in 2025, underpinned by a record-breaking production season.

Zimbabwe’s 2025 tobacco crop recorded exceptionally high output, supported by favourable weather conditions, expanded contract farming, improved access to inputs, and higher farmer participation. Industry data show that total tobacco deliveries reached 350 million kilogrammes, making it one of the largest crops in the country’s history.

The volume surge coincided with record average prices of around US$3.80 per kilogramme, lifting tobacco export earnings to US$1.2 billion for the year. This combination of high output and firm prices reinforced tobacco’s role as Zimbabwe’s most reliable non-mineral source of hard currency.

Diaspora remittances on the other hand , in the first nine months of 2025 contributed  US$2.1 billion in foreign currency inflows in 2025, according to RBZ and ZIMSTAT.

Although remittances do not accrue directly to the central bank, they increase foreign exchange availability in the formal market, support consumption, and help smooth external payment pressures.

Forex reserve holdings climbed to approximately US$1.2 billion, equivalent to about one-and-a-half months of import cover  an improvement, but still below the conventional adequacy benchmark of at least three months.

The growing share of gold in reserves has altered the composition rather than the sufficiency of Zimbabwe’s external buffers, providing a confidence signal rather than a fully deployable liquidity cushion for imports or external shocks.

Since the launch of the ZiG in April 2024, the RBZ has injected roughly US$1.34 billion into the foreign exchange market to support the new currency framework. These interventions, largely funded by export surrender proceeds and mineral-linked inflows, helped anchor the interbank exchange rate around ZiG 26 per US dollar, while containing the parallel market premium below 20 percent for much of 2025.

However, sustained stability depends on the continuity of inflows, particularly from commodities such as gold and tobacco, both of which benefited from unusually favourable price conditions in

Improved foreign currency availability fed into lower inflation outcomes. Annual inflation slowed to 15% by end-2025, well below the RBZ’s 30% target, while month-on-month inflation averaged 0.4%  between February and December.

This disinflation was underpinned by a restrictive monetary stance, including a 35% policy rate, positive real interest rates and a firm commitment to zero central bank financing of government expenditure.

The absence of fiscal dominance has been decisive in weakening Zimbabwe’s historic inflation–exchange-rate feedback loop.

ZiG currency in circulation rose to ZiG 5.31 billion, accounting for 30–40% of domestic payment transactions. While this reflects improved transactional confidence, store-of-value confidence remains conditional on sustained exchange-rate stability.

Despite clear gains, Zimbabwe’s external buffers remain modest. Forex reserves of US$1.2 billion leave the economy exposed to commodity price volatility and external shocks, highlighting the need for continued reserve accumulation and policy discipline in 2026.

 Equity Axis News