Zimbabwe’s new gold-backed currency, the ZiG, is on a roll

Backed by gold and foreign currencies, Zimbabwe’s fledgling currency has steadily risen in its debut week of trading, with an outsize gain on Thursday.

After launching on Monday at $13.56 to the U.S. dollar, the Zig or Zimbabwe Gold, and was trading at $13.45 on Thursday, according to the Reserve Bank of Zimbabwe’s website. That marks its best gain so far, with the currency up 0.8% since its launch.

National payments platform ZimSwitch listed on its website,21 financial institutions that are now allowing for payment processing to be made in the new currency.

In March, the country recorded annual inflation of 55% from over 47% in February, spurred on by the former local dollar that all but collapsed — the Real Time Gross Settlement Dollar (RTGS) that was launched in 2019. Reliance on U.S. dollars also hampered the former currency.

“The Bank’s priority policy focus is critical for supporting the economy’s growth prospects through the restoration of stability, convertibility, and transactional convenience of the local currency,” the central bank, led by Gov. John Mushayavanhu said in a statement last Friday.

The central bank said that as of April 5, it has more than three times gold and cash reserves — 2.5 tons and $100 million in foreign currency — to cover the new currency, which it promised would be “audited by independent external auditors.”