Zimbabwe will this month start selling gold coins as a store of value at a time its currency is weakening considerably, pushing the cost of living beyond the reach of many.
Central bank governor John Mangudya said the coins would be available for sale from July 25 in local currency and United States dollar at a price based on the prevailing price of gold.
The gold coins known as Mosi-oa-Tunya are named after Victoria Falls and can be converted into cash and sold locally and internationally.
Dr Mangudya said the gold coins would reduce pressure on the US dollar in the open market, which the authorities blame for the depreciation of the Zimbabwe dollar.
“As you are aware, the US dollar has largely been used for two things; for the importation of goods and for a store of value. The gold coins will provide an alternative investment option to the US dollar as a store of value.” Central bank governor John Mangudya
The central bank boss said investors that purchase gold coins will be able to preserve value and make good profits when gold prices rise. He said the coins will contain one troy ounce of gold and would be sold through a normal banking channel
Zimbabwe last week more than doubled interest rates to 200 per cent from 80 per cent and announced plans to make the US dollar legal tender for the next five years to restore confidence in the economy.
Soaring inflation in the southern African country has raised the cost of living sharply with the Zimbabwe National Statistics Agency saying annual inflation rose to 191.7 per cent in June compared to 131.7 per cent recorded in May.
The local currency, which was reintroduced in 2019 after a decade of dollarisation, has been losing value rapidly against the US dollar, leading to unrest among the country’s labour force as workers demand to be paid in foreign currency.