By A Correspondent

Renowned American economic analyst Professor Steve Hanke has stated that the Zimbabwe Gold (ZiG) is now the second worst currency globally.

Hanke, known for monitoring troubled currencies, highlighted the significant depreciation of the ZiG since its introduction in April 2023.

In a recent update on his Hanke’s Currency Watchlist, Hanke wrote: “On this week’s Hanke’s Currency Watchlist, the Zimbabwean ZiG checks in as the 2ND WORST CURRENCY IN THE WORLD.”

He further explained, “Since its adoption on April 8th, the ZiG has depreciated by approximately 67% against the USD.”

The ZiG, a gold-backed currency introduced as a means to stabilize Zimbabwe’s economy, has struggled due to several factors.

One of the main challenges is the widespread lack of confidence in the currency, both among consumers and businesses in Zimbabwe.

Professor Hanke suggests that the ZiG’s decline is largely due to Zimbabweans’ reluctance to trust the new currency.

This sentiment is compounded by ongoing economic challenges within the country, making it difficult for the currency to gain traction.

The Reserve Bank of Zimbabwe (RBZ) has also acknowledged the difficulties surrounding the ZiG.

In an official statement, the RBZ admitted that the gold-backed currency should be allowed to “float freely on the foreign exchange market.”

This suggestion signals a potential shift in strategy, as the RBZ considers more market-driven approaches to address the ZiG’s plummeting value.