Zimbabwe’s economy is showing signs of potential stabilization, with a significant slowdown in annual inflation, which had been anticipated by the end of 2025.
- Zimbabwe’s economy is showing signs of stabilization, with inflation rates significantly decreasing.
- The Zimbabwe Gold (ZiG) currency has supported economic recovery, reflecting increased usage in transactions.
- Stricter monetary policies and foreign exchange stability are contributing factors to the declining inflation.
- Market confidence is reflected in the growing foreign investor participation in Zimbabwe’s stock market.
This optimistic projection was reported in November last year by the Confederation of Zimbabwe Industries (CZI), which forecasts an impressive fifty percent decrease in the annual inflation rate.
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The report at the time indicated that the CZI stated annual inflation, measured in the Zimbabwe Gold (ZiG) currency, experienced a sharp decline to 32.7% in October from 82.7% in September.
The organisation projected a further dip in inflation, potentially reaching a range of 15% to 20% by December 2025.
However, current reports indicate that the Southern African country has seen its first single-digit local currency inflation in more than 20 years, marking a critical turning point for the nation’s economic development.
As reported by Bulawyo24News, Zimbabwe’s dollar inflation rate (ZiG) fell to 4.1% in January, from 15% in December and 19% in November 2025.
The reduction is attributed by analysts to stricter monetary policies, ameliorated supply chain conditions, and comparative stability within foreign exchange markets. Projections indicate a moderation of inflationary pressures, which could potentially reinstate consumer and investment confidence.
Zimbabwe last experienced this level of inflation decrease in 2018, when local prices were essentially set at parity with the US dollar.
Zimbabwe has spent more than a decade seeking to create a functional national currency after repeated failures caused hyperinflation, wiping out savings and forcing Zimbabwe to accept the US dollar in 2009.
Its most recent effort, the ZiG, which stands for Zimbabwe Gold, was launched in April 2024 and currently accounts for nearly 40% of daily transactions.
Oxford Economics experts claim that the ZiG, which is partially backed by gold, has stayed steady in official markets with a parallel-market premium of roughly 20%.
Due to persistently high prices, gold production is also anticipated to exceed the record 38.4 tons attained in 2024.
Zimbabwe’s latest developments represent a modest return to stability following more than 20 years of currency instability and uncontrollable high inflation.
According to economists, a sustained reduction in pricing would be essential for fostering a wider economic recovery and restoring trust in local currency.
Last year, reports showed that foreign involvement in Zimbabwe’s stock market increased significantly in the second quarter of 2025, reflecting renewed investor interest in the country’s improving economic fundamentals and the relative stability of its new gold-backed currency.
According to the Zimbabwe Stock Exchange (ZSE)’s quarterly newsletter during the review period, foreign investor activity increased to 26.53% of total trading in Q2, up from 15.39% the previous quarter.
