Zimbabwe’s latest attempt to stabilize its economy with a gold-backed currency, the Zimbabwe Gold (ZiG), is facing growing public skepticism despite continued assurances from the country’s central bank.

The Reserve Bank of Zimbabwe (RBZ) maintains that the ZiG is fully backed by reserves, including 2.5 tonnes of gold and $100 million in foreign assets, and insists the new currency is stable.

But confidence among citizens and investors remains fragile.

Launched in April as Zimbabwe’s sixth currency initiative in just 15 years, the ZiG was intended to halt inflation and restore faith in the local financial system.

While official data shows some early progress, usage rose from 26% in April to 43% in May, the reality on the ground tells a different story.

Many Zimbabweans still prefer to transact in U.S. dollars, wary of a repeat of past economic collapses marked by hyperinflation and sudden currency changes.

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Reserve Bank Governor John Mushayavanhu defended the currency in an interview with Reuters, saying, “ZiG is our national currency, and we are committed to ensuring its success by maintaining all the fundamental characteristics of sound money, including its function as a reliable store of value.”

He added, “The Reserve Bank has learned from previous currency failures that maintaining an optimal money supply and ensuring monetary stability is vital.”

Despite the central bank holding $701 million in reserves and maintaining the benchmark interest rate at 35% to support exchange rate stability, doubts linger.

The ZiG continues to trade below its official value on the parallel market, exposing a deep trust gap that even a strong reserve position hasn’t been able to close.

Finance Minister Mthuli Ncube remains hopeful, projecting that the government’s broader monetary reforms could unlock $2.6 billion in bridge financing by mid-2026. Yet international investors remain cautious.

Jetro Siekkinen of LGT Capital Partners told Reuters, “We wouldn’t invest in Zimbabwe at the current stages. The country needs to have a lot more development before we would consider it.”

Analysts have pointed to several red flags: limited transparency over gold reserves, the ZiG’s restricted convertibility, and ongoing inflation risks.

Zimbabwe’s current reserve levels also fall short of international standards, with just 0.8 months of import cover, well below the International Monetary Fund’s recommended three-month minimum.

For now, despite central bank optimism and some early signs of progress, public faith in the ZiG remains weak.

Without greater policy credibility, economic transparency, and reduced reliance on the black market and U.S. dollar, the currency’s long-term future remains uncertain.

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