News / National
RBZ projects inflation drop by September
04 Jun 2025 at 13:31hrs | Views
The Reserve Bank of Zimbabwe (RBZ) has assured the nation that inflation remains under control, despite seemingly high annual inflation rates, attributing the figures to technical distortions arising from the introduction of the Zimbabwe Gold (ZiG) currency.
RBZ Governor Dr John Mushayavanhu said in a media briefing that the central bank has effectively managed month-on-month inflation, maintaining it within the targeted range, and reaffirmed that the nation should expect continued price stability in the long term.
He dismissed current high year-on-year inflation figures as "largely inconsequential," noting they were the result of a statistical base effect following the introduction of the ZiG currency in April 2024.
"The ZiG was introduced as a new currency in April 2024, and there was no meaningful base to calculate annual inflation figures until now, when a 12-month cycle has lapsed," said Dr Mushayavanhu. "The high inflation figures are a result of what you call the base effect of a new currency and also the one-time shock in September 2024, which saw a spike in prices."
He said that by September 2025, annual inflation figures will reflect a more accurate picture of the economy, with a significant drop expected.
Dr Mushayavanhu reiterated the strength of the ZiG currency, highlighting that it is backed by strong fundamentals, particularly Zimbabwe's rapidly growing gold reserves.
"Our reserves have grown at an unprecedented rate from US$257 million to just under US$700 million within a year of the ZiG's introduction. I want to assure the nation that the ZiG is here to stay," he said.
The central bank has implemented a tight monetary policy framework, guided by a "back-to-basics" approach that emphasizes disciplined spending, responsible money supply growth, and exchange rate stability.
The RBZ has also adjusted its exchange rate management strategy in line with market conditions, helping to boost investor and consumer confidence in the domestic currency.
As the country navigates the transition into a more stable macroeconomic environment, Dr Mushayavanhu said the RBZ remains focused on building long-term credibility and restoring trust in Zimbabwe's monetary institutions.
RBZ Governor Dr John Mushayavanhu said in a media briefing that the central bank has effectively managed month-on-month inflation, maintaining it within the targeted range, and reaffirmed that the nation should expect continued price stability in the long term.
He dismissed current high year-on-year inflation figures as "largely inconsequential," noting they were the result of a statistical base effect following the introduction of the ZiG currency in April 2024.
"The ZiG was introduced as a new currency in April 2024, and there was no meaningful base to calculate annual inflation figures until now, when a 12-month cycle has lapsed," said Dr Mushayavanhu. "The high inflation figures are a result of what you call the base effect of a new currency and also the one-time shock in September 2024, which saw a spike in prices."
He said that by September 2025, annual inflation figures will reflect a more accurate picture of the economy, with a significant drop expected.
"Our reserves have grown at an unprecedented rate from US$257 million to just under US$700 million within a year of the ZiG's introduction. I want to assure the nation that the ZiG is here to stay," he said.
The central bank has implemented a tight monetary policy framework, guided by a "back-to-basics" approach that emphasizes disciplined spending, responsible money supply growth, and exchange rate stability.
The RBZ has also adjusted its exchange rate management strategy in line with market conditions, helping to boost investor and consumer confidence in the domestic currency.
As the country navigates the transition into a more stable macroeconomic environment, Dr Mushayavanhu said the RBZ remains focused on building long-term credibility and restoring trust in Zimbabwe's monetary institutions.
Source - ZBC
