IMF Says Gold Coins Are A Missed Chance To Build Zimbabwe's Gold Reserves
The International Monetary Fund (IMF) has said the Zimbabwean gold coins are a missed chance to build the nation’s gold reserves.
The Reserve Bank of Zimbabwe (RBZ) introduced the Mosi-oa-Tunya gold coins on 25 July this year in a bid to curb stabilise the economy and the local currency that was fast shedding value against the United States dollar.
In an emailed response to Bloomberg questions, an IMF spokesperson said:
The sale of gold coins has contributed to withdrawing Zimbabwe dollar liquidity from the market, though it represents an opportunity cost in terms of foregone reserves for the Reserve Bank of Zimbabwe.
The central bank plans to sell smaller denominations of the Mosi-oa-Tunya gold coins, named after Victoria Falls, from November.
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The smallest, a tenth of an ounce, will be made available to the public through banks and approved dealers. A regular-size one is selling for $1 755, according to data available Thursday on the central bank’s website.
The government credits the coins for halting the decline in the parallel market rate for the Zimbabwe dollar. That’s allowed it to converge with the official rate, which has plunged more than 80% against the US currency this year.
Gold output in the southern African nation surged 41% in the first eight months of the year to 22,290 kilograms from a year earlier. The country aims to produce 35 tons of bullion in 2022.