The Reserve Bank of Zimbabwe (RBZ) has described 2025 as a breakthrough year for economic stability, marked by declining inflation, improved exchange rate predictability, rising foreign currency reserves and strengthened policy credibility.
In its latest Quarterly Snapshot on Recent Monetary, Currency, Price and Financial Developments, for the period ending December 31, 2025, the central bank said the year’s outcomes highlighted the effectiveness of a disciplined monetary policy framework anchored on tight money supply control, enhanced fiscal coordination and a more flexible exchange rate under the Willing-Buyer Willing-Seller system.
“Monetary policy during 2025 demonstrated clear effectiveness, restored discipline, and measurable macroeconomic gains, particularly in inflation control and exchange rate stability.
“Sustaining this trajectory in 2026 will require continuing to walk the talk in prudent money supply management, foreign currency reserve accumulation and strong fiscal and monetary policy complementarity,” said RBZ Governor, Dr John Mushayavanhu.
One of the central bank’s major achievements was the marked decline in ZiG annual inflation, which fell to 15 percent by year-end, well below the 30 percent target. Monthly inflation remained contained, averaging 0,4 percent from February to December, reinforcing expectations that price stability had shifted from a temporary occurrence to a structural trend.
Exchange rate stability was another key highlight for 2025. The interbank rate hovered around ZiG26 per US dollar, while the parallel market premium stayed below 20 percent for most of the year, a significant improvement compared to earlier periods of volatility.
Economic analyst, Marlone Gwadu, said the twin gains in inflation and exchange rate stability have materially improved Zimbabwe’s economic outlook.
“When inflation is trending down and the exchange rate is broadly predictable, investors can finally begin pricing risk more rationally. For 2026, this opens space for longer-term contracts, improved portfolio flows and renewed interest in productive sectors, provided policy consistency is maintained,” he said.
He added that steady prices have reduced pressure on wages and interest rates, helping stabilise conditions in manufacturing, mining and services.
On the monetary front, the RBZ emphasised that reserve money growth was tightly controlled at ZiG5,3 billion as of December 2025, while Government financing remained at zero, an important marker of fiscal discipline.
Economist Dr Shaun Chikovore noted that this restraint was essential for maintaining the gains achieved.
“Reserve money growth has historically been the trigger for inflationary episodes in Zimbabwe. The fact that growth was contained, alongside zero quasi-fiscal activity, signals a structural shift. If this discipline holds in 2026, inflation expectations are likely to remain anchored,” he said.
The RBZ also highlighted substantial improvements in the external sector. Foreign currency receipts rose to US$16,2 billion in 2025, up from US$13,3 billion in 2024, enabling reserve accumulation of US$1,2 billion, equivalent to 1,5 months of import cover. Importantly, these reserves now provide six times cover of ZiG reserve money and nearly double total ZiG deposits, key indicators of a more resilient currency.
Another notable development was the increased use of the ZiG, which accounted for 30–40 percent of all transactions in the national payment system. Cash in circulation also rose modestly to ZiG510 million, representing 3 percent of broad money.
Economic analyst, Persistence Gwanyanya said the shift towards the ZiG reflected genuine market confidence.
“The key difference in 2025 is that people are using the ZiG because it is stable, not because they are forced to. For 2026, wider acceptance will depend on continued exchange rate stability and confidence that purchasing power will be preserved,” he said.
He added that increased local currency usage helps reduce dollarisation risks and strengthens the effectiveness of monetary policy.
The central bank also noted that the financial sector and national payment systems remained sound throughout the year, supported by stronger prudential supervision and improved liquidity management.
Taken together, the 2025 outcomes significantly advance Zimbabwe’s roadmap toward a mono-currency system, as outlined under the National Development Strategy 2 (NDS 2), which prioritises macroeconomic stability as a foundation for Vision 2030.
