By A Correspondent
The Reserve Bank of Zimbabwe (RBZ) has projected that annual ZiG inflation will decline to below 30% by December 2025, despite current year-on-year figures showing a sharp rise. The central bank remains confident that tight monetary policies and economic reforms will stabilize prices and strengthen the local currency.
In a press statement issued on 4 June 2025, the RBZ attributed the current spike in annual inflation—which rose to 92.1% in May, up from 85.7% in April—to what it described as a “once-off base effect” resulting from a price shock that occurred between September and October 2024, when month-on-month inflation soared from 5.8% to 37.2%.
“The sharp rise in year-on-year ZiG inflation to 92.1% in May 2025 is due to a once-off base effect caused by a September–October 2024 price shock,” the RBZ said in its statement.
Despite this alarming annual figure, the RBZ highlighted that month-on-month inflation has remained below 1% for the past three months, indicating relative price stability.
“Low month-on-month inflation continues, signaling minimal recent inflationary pressure,” the central bank noted.
Looking ahead, the RBZ said it expects inflation to stabilize from October and fall below 30% by December 2025, with a broader goal of achieving single-digit inflation in the long term.
“ZiG inflation is projected to stabilize from October 2025 and fall below 30% by year-end,” the statement read.
The central bank also urged economic stakeholders to focus more on month-on-month inflation data, which it said offers a more accurate picture of current economic conditions, rather than annual inflation, which remains distorted due to the transition from the Zimbabwe dollar (ZW$) to the ZiG currency in 2023–2024.
“We urge economic agents to monitor month-on-month inflation instead of annual figures, which are distorted by historical statistical gaps,” the RBZ emphasized.
In support of this outlook, the RBZ pledged to maintain a tight monetary policy stance, saying it will continue to prioritize inflation control, exchange rate stability, and overall economic growth.
“The Bank remains committed to preserving purchasing power and value stability. The current rise in annual inflation will not affect real consumer value due to its historical nature,” it said.
This latest statement comes amid public concern over the value of the ZiG, which has faced scrutiny since its introduction last year. However, the RBZ insists that current indicators show a strengthening trend and that the economy is moving toward stabilization.
With inflation management remaining a key focus, the next few months will be crucial for the RBZ to prove that its projections hold—and that Zimbabwe’s newest currency can earn the confidence of the public.