Zimbabwe’s manufacturers expect the country’s inflation trajectory to improve significantly over the next 12 to 18 months, supported by a more stable local currency regime and strong global demand for gold. The Confederation of Zimbabwe Industries (CZI), the country’s largest industrial lobby group, has projected that annual inflation — measured in the Zimbabwe Gold (ZiG) currency — could fall by almost half by the end of 2025.
According to CZI’s latest “Inflation and Currency Developments Update,” ZiG inflation reduced to 32.7% in October, sharply lower than the 82.7% recorded in September. If current trends continue, the organisation expects annual inflation to settle between 15% and 20% by December 2025.
The projected decline is being linked to two key factors:
1. Negative month-on-month inflation in recent months, which signals rising price stability in the formal market.
2. Continued appreciation in global gold prices, which is supporting ZiG, a currency partially backed by gold reserves.
CZI noted that the Reserve Bank of Zimbabwe is targeting around 30% annual ZiG inflation, and recent price behaviour is broadly aligned with that policy objective.
Independent analysts from Oxford Economics add that the parallel market premium for ZiG remains around 20% — relatively narrow by Zimbabwean standards — suggesting improved currency confidence compared to previous years. The same analysts believe Zimbabwe’s gold output in 2025 could surpass the 38.4 tonnes produced in 2024, thanks to higher international bullion prices and increased investment in artisanal and small-scale mining.
Zimbabwe has struggled with hyperinflation, policy reversals and episodes of dollarization for much of the last two decades — all of which have severely weakened trust in local currencies. Economists say lasting price stability would represent a strategic turning point — not only for monetary credibility, but also for local industry planning, foreign investor confidence, and long-term economic recovery.
If the current stability in the ZiG is sustained, analysts say Zimbabwe could see a gradual shift away from U.S. dollar dependency and a more predictable macro-economic environment for businesses and households.
Source:Africa Publicity
