The Central Bank of Zimbabwe has announced that it will start minting gold coins in the month of July. The decision is aimed at curbing record inflation, which has led to a severe devaluation of the local currency. Central bank governor John Mangudya said in a statement that the coins went on sale on July 25. They can be purchased by paying in local currency, US dollars and other foreign currencies. Their price is adjusted to the international price of gold and production costs, reports Reuters. The “Mosi-oa-tunya” coin is named after Victoria Falls, which is its name in the local Lozi language. It can be exchanged for currency and traded inside and outside the country, reports the central bank. The gold coin will contain one troy ounce of gold and can be purchased from gold refiner Fidelity Gold Refinery, local gold jewelry manufacturer Aurex and local banks. Gold coins are typically used by investors to hedge against inflation and in times of war. Zimbabwe raised its key interest rate from 80% to a record 200% and indicated it plans to recognize the US dollar as legal tender within five years.
The growing reawakens the population’s memories of the economic chaos during President Robert Mugabe’s nearly four-decade rule. Annual inflation, which hit 192% in June, has hampered current President Emmerson Mnangagwa’s attempt to revive the economy. Zimbabwe last switched to using foreign currencies in 2009 when the Zimbabwean dollar lost its value. The government accepted payment in local currency again in 2019, but now the country is once again facing a familiar problem.