Reserve Bank of Zimbabwe cuts bank policy rate to 30% as Q2 ZiG inflation stays below 5%

The Reserve Bank of Zimbabwe published its second-quarter 2026 monetary and financial snapshot showing annual ZiG inflation remained below 5%, ending June at 4.72%, and that the bank policy rate was cut in June to 30% from 35%. The bank presented the move as a recalibration to a lower and more stable inflation environment rather than a broader easing of monetary policy. It also reduced the Targeted Finance Facility rate to 15% from 20%, with banks' on-lending to productive sectors capped at an all-inclusive 25%. The update points to continued exchange-rate and liquidity stability. The ZiG traded in a ZiG25-ZiG27 per USD range, averaged ZiG26.05 per USD in the second quarter and closed June at ZiG26.77, while the parallel-market premium stayed below 20%. Reserve money stood at ZiG6.6 billion at end-June, below the ZiG7.3 billion target agreed with the International Monetary Fund under the Staff Monitored Program. The Reserve Bank also operationalised ZiG Denominated Term Deposit Facility bills as an open market instrument to support local-currency savings and the short-term yield curve, with ZiG466.6 million outstanding across 30-day and 90-day tenors at end-June. Foreign currency receipts totaled USD10.72 billion in January to June, reserves rose to USD1.6 billion or 1.6 months of import cover, and those reserves were reported to cover about six times ZiG reserve money and about 1.5 times total ZiG deposits. The Reserve Bank said it will continue calibrating monetary policy and money-supply growth in line with macroeconomic conditions. It projected single-digit annual ZiG inflation and month-on-month inflation below 1% through 2026, with foreign currency inflows supporting a current account surplus of more than USD2.5 billion and import cover of 1.7 to 2 months by year-end.