HARARE -- Zimbabwe's gold-backed currency started trading on Monday following the announcement of the new currency by the central bank last Friday.

The Zimbabwe Stock Exchange (ZSE) announced that effective from April 8, the trading currency is the Zimbabwe Gold, or ZiG.

"All share prices will now be denominated in ZiG, therefore the opening prices for the trading session effective April 8 will reflect the ZiG currency," said ZSE CEO Justin Bgoni in a statement.

Zimswitch, a national payment platform, also announced on Monday that ZiG had gone live.

The introduction of the new currency by the central bank comes in response to the rapid depreciation of the old Zimbabwe dollar.

According to Reserve Bank of Zimbabwe Governor John Mushayavanhu, the new structured currency will be backed by a basket of foreign exchange reserves and precious metals, mainly gold, being held by the central bank.

Mushayavanhu said the central bank was starting with total reserves of 285 million US dollars to back up the new currency.

Zimbabwe adopted a multi-currency regime in 2009 to stabilize the economy following years of hyperinflation. The government in 2019 outlawed the multiple currency regime and re-introduced the Zimbabwe dollar as the sole legal tender.

In 2020, the government reintroduced the multi-currency regime. Since then, the use of the US dollar has grown in the economy, with the national statistics agency ZIMSTATS saying that over 85 percent of international transactions are in the US dollar.