Monthly Economic Update | Zimbabwe Outlook, Inflation, ZiG, Sectors & Commodities

1) Zimbabwe Economic Performance

Economic outlook for 2026

Zimbabwe’s economy is projected to grow by about 5.0% in 2026 (Government and World Bank), reflecting broad-based performance across key sectors. Agriculture is expected to expand by 5.4% (favourable weather), mining by 6.3% (higher gold output), and manufacturing by 3.7% (investment and capacity improvements).

The outlook is further supported by ongoing reforms to streamline regulatory fees, improving confidence for investment. Trade prospects also strengthen with China’s pledge of zero tariffs on Zimbabwean goods, alongside evidence of growing trade volumes and a sustained trade surplus with China.

2) Zimbabwe Financial Sector

Money supply (M3)

Broad money (M3) increased marginally month-on-month in November 2025, while year-on-year growth accelerated—reflecting the impact of prevailing monetary conditions and recent policy actions.

Interest rates and liquidity conditions

The RBZ Monetary Policy Committee reaffirmed key policy measures, including maintaining the policy rate at 35% and keeping statutory reserve requirements unchanged across local and foreign currency deposits.

Foreign currency market & ZiG exchange rate

In December 2025, the Zimbabwe Gold (ZiG/ZWG) remained broadly stable, appreciating slightly on the official market, while parallel market pricing stayed relatively steady, leaving the premium modestly wider over the month.

3) Prices and Cost of Living

Inflation trends

December 2025 inflation data signal improving price stability: weighted year-on-year inflation eased to 13.3%, with subdued monthly pressures. USD year-on-year inflation also declined to 12.4%, and ZiG/ZWG year-on-year inflation eased to 15.0%.

Food price dynamics remain important to monitor, given their strong influence on household wellbeing and vulnerability.

Poverty datum lines

The Total Consumption Poverty Line (TCPL) increased slightly month-on-month, while the Food Poverty Datum Line (FPDL) rose a bit faster, indicating that food costs, even in a moderating inflation environment, can still create pressure for households.

4) Sector Highlights

External sector

Zimbabwe’s merchandise exports edged higher in November 2025, while imports declined, supporting a stronger trade balance. Export composition remained concentrated, led by semi-manufactured gold and tobacco, while imports were dominated by mineral fuels and machinery.

Mining

Mining is expected to be a major growth driver in 2026, supported by gold and coal. Gold deliveries rose sharply in December 2025, with artisanal and small-scale miners accounting for a significant share of total output.

Agriculture

After a contraction in 2024, agriculture rebounded strongly in 2025. For 2026, growth is projected to normalize but remain positive, supported by crop plantings and continued policy focus on irrigation and storage infrastructure.

Energy

Renewable energy transition continues through policy reforms and new investment initiatives. However, generation constraints and maintenance-related outages underscored ongoing supply risks, especially for energy-intensive sectors.

Manufacturing, property, and tourism

Manufacturing growth is projected to improve in 2026, helped by stronger linkages with agriculture and retooling support initiatives. Property market activity remains cautiously optimistic, while tourism growth is expected to benefit from fee reductions and regulatory reforms that reduce operating costs and stimulate investment.

5) Regional Economies

Sub-Saharan Africa (SSA)

SSA growth is forecast to firm in 2026, supported by reforms and easing inflation, although downside risks remain, especially weaker external demand, lower commodity prices, and political instability.

Botswana, South Africa, Zambia, and Malawi

Regional performance remains mixed: Botswana is projected to recover in 2026 after contraction, South Africa is expected to continue a gradual improvement, Zambia’s growth is projected to remain robust, and Malawi’s outlook is constrained by persistent foreign exchange pressures and elevated inflation.

6) Global Economy

Global outlook

The global economy remains resilient but is expected to slow as trade momentum weakens. Policy uncertainty and trade tensions remain key considerations for investment, supply chains, and commodity demand.

USA, China, Germany, UK, and UAE

Growth expectations vary across major economies: the USA is projected to maintain moderate growth, China’s growth is expected to soften with stimulus support, Germany continues to face structural constraints, the UK shows gradual recovery signals, and the UAE’s diversification supports a stronger outlook.

7) Commodities Markets

For commodity-linked economies, stronger precious metal prices can support export earnings, foreign exchange availability, and fiscal space, while lower oil prices ease import costs and inflation pressure.