ZiG Is Very Undervalued By Nearly Half: RBZ Governor Says It Should Be Trading At ZiG15: US$1
Zimbabwe’s gold-backed currency, the ZiG, is undervalued by nearly half and should be trading closer to ZiG15 to US$1 (approx. R285), according to the Reserve Bank of Zimbabwe (RBZ) Governor John Mushayavanhu, who says the country’s reserves are strong enough to support that level.
The remarks, made on Friday, April 18, 2026, have sparked debate about the true value of the currency, which is currently trading between ZiG25 and ZiG28 to US$1 (approx. R475 to R532).
Governor Points To Reserves And Gold Backing
Bloomberg reports that the central bank chief said the ZiG’s current exchange rate does not reflect the underlying strength of Zimbabwe’s reserves.
“If we wanted to buy back all the local currency that is in the market using the reserves that we have, we could do that at an exchange rate of around 15,” Mushayavanhu said.
He argued that the combination of foreign currency reserves and gold holdings gives the ZiG stronger backing than what is currently reflected in the market.
“The currency is undervalued by almost half,” he added, pointing to what he described as a mismatch between the official valuation and the fundamentals supporting the unit.
The ZiG, introduced as part of efforts to stabilise Zimbabwe’s currency system, has been positioned as a structured, asset-backed alternative to previous local-currency regimes.
Market Reality And Public Reaction
Despite the governor’s confidence, public reactions suggest lingering scepticism about the currency’s real-world performance.
Social media users on X questioned the gap between official statements and everyday economic realities.
“Currency weight is determined by the markets. Why not just let it float on the market?” said @chinyemu.
Another user, @RefugeeEconomic, raised concerns about accessibility and usage:
“The Zimbabwe currency makes up 10% of transactions… a majority of Zimbabweans don’t even have access to local currency.”
Others pointed to practical limitations in the economy.
“But it can’t even be used to buy fuel locally and even some other government services,” said @godietm.
The comments highlight ongoing concerns about usability, confidence, and the role of market forces in determining exchange rates.
Debate Over Policy Direction
The governor’s remarks have also reignited debate about whether Zimbabwe should allow its currency to float freely.
Some observers argue that a market-driven exchange rate would provide a clearer picture of the ZiG’s true value.
“Big claim—but markets will be the real judge,” said @ThriveTrack.
Another comment added:
“If the currency is truly undervalued, you’d expect capital inflows and stability… but confidence and policy credibility matter just as much as valuation.”
Since April 2024, authorities have reportedly injected over US$1.5 billion (approx. R28.5 billion) into the foreign exchange market in efforts to stabilise the currency and narrow the gap between official and parallel market rates.
However, questions remain about sustainability, particularly regarding export earnings and liquidity controls.
As the debate continues, the governor’s statement has placed fresh focus on the gap between official exchange rates and market sentiment.
The post RBZ Says ZiG Undervalued By Half, Should Be ZiG15 To US$1 appeared first on iHarare News.
