As part of efforts to rein in spiraling inflation and a depreciation of its currency, Zimbabwe says it will introduce gold coins later this month. The nation’s central bank also provided details on its plans to declare the US dollar to be legal tender for the following five years.
After the annual rate of inflation surpassed 190 percent this month, the central bank’s main interest rate was more than doubled to 200 percent.
This year, the value of the Zimbabwean dollar relative to major currencies has plummeted.
The gold coins, which will be available starting on July 25, will each contain one troy ounce of 22-carat gold. Governor of the Reserve Bank of Zimbabwe, John P. Mangudya
A troy ounce is a weighting unit from the Middle Ages that is used for precious metals like gold, silver, and platinum. A troy ounce weighs 31.10 grams. According to Mr. Mangudya, “The gold coins will be offered for sale to the general public in both local currency and US dollars and other foreign currencies at a price based on the current international gold price and the cost of production.”
The announcement added that each coin will have a unique serial number and can be quickly exchanged for cash both domestically and abroad. It will be known as the “Mosi-oa-Tunya Gold Coin,” which is an allusion to Victoria Falls, which is situated on the border between Zimbabwe and Zambia and means “The Smoke Which Thunders.”
The announcement is a component of the government of Zimbabwe’s plans to deal with the nation’s currency crisis. The Zimbabwean dollar has lost more than two-thirds of its value against the US dollar since 2022 began, and the annual rate of inflation last month reached 191.6 percent.
To address the rising cost of living, the Reserve Bank of Zimbabwe increased its main interest rate from 80% to 200% annually as of July 1. In a nation that still vividly recalls the economic chaos under Robert Mugabe’s nearly four decades of rule, rising inflation has put President Emmerson Mnangagwa under pressure.
In 2009, hyperinflation compelled the country to stop using the Zimbabwe dollar and start using foreign currencies, primarily the US dollar. The government stopped releasing official inflation data during the height of the crisis, but one estimate placed the rate at 89.7 sextillion percent year-over-year in mid-November 2008.