Zimbabwe News Update
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By Alois VingaFINANCE Minister, Mthuli Ncube, says the local ZWG currency is set to strengthen further in the Fourth Quarter of the year as demand rises for periodical tax settlements.Since last year, the central bank has implemented a restrictive monetary policy aimed at anchoring price, currency, and exchange rate stability.
The approach involves maintaining a high bank policy rate, currently at 35%, to curb speculative borrowing, which has been a major driver of excess liquidity and illicit parallel market activity.To this end, the exchange rate premium has remained stable for a period in excess of one year, which has seen annual inflation receding by more than 50% to 32,7%.Speaking to parliamentarians in Bulawayo Wednesday, Ncube said the local unit is poised to strengthen further as the year comes to an end.“Fourth quarter taxes are expected to increase demand for ZiG, and the appreciation of the exchange rate.
In the outlook, exchange rate stability is envisaged, underpinned by the broad acceptance of the ZiG and the continued implementation of prudent fiscal and monetary policies by the Government,” Ncube said.He attributed the obtaining stability, which has seen the exchange rate maintaining a premium of US$1: ZWG 26.68 to the aggressive policies employed to ring fence the currency.“The parallel market exchange rate premium has remained stable, falling to below 25% in August 2025, aligning with other countries, including Kenya and Zambia,” he said.Ncube said the strategy for accelerated building of foreign currency reserves is bearing fruit following the introduction of the ZiG, which has seen total foreign currency reserves increasing from below US$300 million in April 2024 to over US$900 million by September 2025, targeting US$1 billion by December 2025.Zimbabwe is accumulating both gold and USD reserves which are expected to fully cover both ZiG reserve money and deposits.Added Ncube, “Inflation is projected to average 61.3% in 2025, end the year at 22.8%, and decline to single-digit levels by 2027, supported by continued exchange rate stability and prudent fiscal and monetary policies.” FINANCE Minister, Mthuli Ncube, says the local ZWG currency is set to strengthen further in the Fourth Quarter of the year as demand rises for periodical tax settlements.
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