Zimbabwe To Mint Gold Coins In Pushback Against US Dollar Demand

The Southern African nation of Zimbabwe has announced it will begin minting gold coins later this month in a bid to tackle soaring inflation and the faltering Zimbabwe dollar (ZWL). The coins, which will consist of one troy ounce of 22-carat gold, will depict the world famous natural landmark the Victoria Falls and will be available from July 25th. The move comes at a time when the ZWL has lost over two thirds of its value against the USD in 2022 alone as President Emmerson Mnangagwa desperately tries to restore some trust in the Zimbabwean economy.

Zimbabwe will join a growing list of nations that already mint their own gold bullion coins including the UK, US, China and neighbouring South Africa. The trade of gold bullion coins has been a defence mechanism for governments against inflation and turbulent global economic conditions for many years since the introduction of the South African Krugerrand in the late 1960s. Today, the gold coin market is a diverse one with London based gold dealers Sharps Pixley alone selling nearly 40 different coins from 8 separate countries.

John Mangudya, Governor of the Reserve Bank of Zimbabwe, confirmed “the coin will have liquid asset status, that is, it will be capable of being easily converted to cash, and will be tradable locally and internationally”. Mangudya further added that the coins would be available for purchase in “both local currency and US dollars and other foreign currencies at a price based on the prevailing international price of gold and the cost production” and that the Bank would guarantee it would repurchase the coin from the holder if so desired.

The uptake of the coin by local and international investors alike will be watched closely by governments all over the world as the International Monetary Fund (IMF) has said it expects inflation pressures to be significant throughout the remainder of 2022. Pressure is expected to be particularly acute for other developing nations like Zimbabwe who will be watching the introduction of Zimbabwe’s coin with extra interest.

Sponsor Ads

• Ad Space Available - Rent it Now!

Report this Page

Created on Jul 28th 2022 06:24. Viewed 184 times.

Share on APSense

Comments