Friday, March 29, 2024

The Kwacha weakens

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Zambia’s currency recovered some lost ground on Tuesday but is still sharply weaker against the dollar this month on risk aversion, lower copper prices and ahead of presidential elections.

Evans Chibiliti, Secretary to the Treasury in Zambia, Africa’s biggest copper producer, said on Tuesday the kwacha had come under pressure after foreign investors divested treasury bills and government bonds due to concerns about global growth.

“There is also uncertainty over the elections on October 30,” he said, referring to the currency’s depreciation at a planning meeting for the 2009 budget, state ZNBC radio reported.

The kwacha had rallied about 2 percent against the dollar to 3,830 by 1315 GMT, as investors moved back into riskier assets after developed nations unveiled plans to protect struggling banks, which helped boost copper prices.

However, it is still about 8 percent weaker since the start of October — similar to the fall for South Africa’s rand over the same period.

Zambians will on October 30 elect a successor to Levy Mwanawasa, who died in August after a stroke.
Mwanawasa was widely praised for austere policies that helped lift economic growth and kept inflation under control, and his death raised political and economic uncertainty.

Munalula Mate, the Treasurer of CitiBank Zambia said lower copper prices had added to pressure on the currency.

“Since copper has been slumping on the world market, it (kwacha) is mainly following the copper price,” he said.

The copper price jumped almost 10 percent on Tuesday but is down around 40 percent since hitting a record high in July.

Reuters

73 COMMENTS

  1. The kwacha actually begun depreciating against the major currencies following Mwanawasa’s demise. Now they say the …..

  2. Let them not say Sata is chasing Chinese. Its becoz they dont want to support the mmd salary increments for its wasteful govt.
    Honestly how do buy ubunga 600 thousand bags thinking ukalyapofye,even when u know filabola. Wastage of public money by MMD thru ECZ shud be condemned from the chief justice , speaker and well meaning zambians

  3. investers are not happy with Rupiah Banda’s corruption stance hence the depreciation of our currency, can investers trust the likes of mulongoti, tetemashimba, nevers ,and some chaps sorrounded Rupiah?

  4. Its wrong to depend on one commodity like copper pa zed. Invest in other ventures like agriculture, tourism etc. In fact we don`t even contol the prices of copper it only depends on how the white man works up. Soon the copper deposits will finish and we ll seen apo mukoma ukuboko. Ine shakabwele kuno ku UK yalipasa nachimayo ichikote ichabula amatako.

  5. YOU SEE LADIES AND GENTLEMEN,MAGANDE HAS BEEN SIDELINED BY RUPIAH BWEZANI BANDA.HE IS MISUSING TREASURY FUNDS FOR POLITICAL CAMPAIGNS AND I HOPE THESE GUYS(MMD) ARE NOT GETTING MONEY FROM BOZ,COZ I TELL U ECONOMICALLY IT WILL BE A DISASTER….THE FUEL REDUCTION IS FAKE AND CHEAP POLITICS MR. BANDA.WE ARE NOT KIDS FROM LILANDA BASIC SCHOOL OR THOSE FROM WESTERN PROVINCE….PLIZ LEAVE OUR COUNTRY ALONE IF U ARE NOT A ZAMBIAN..MAGANDE WAS A PREFFERED CANDIDATE AND NOT U.THAT IS WHY I HAVE RESIDGED FROM MMD.U ARE LOOSING THESE ELECTIONS.TWAVUTIKA.PABWAAAAAATO.

  6. It is time for Zambia to wake up. We cannot continue depending on investors to develop our country. We can create our own local investors giving them the same good incentives that foreign investors are given on a silver plater. What is wrong with our governmen? Please njebeniko mwebantu!

  7. Thats why u need to elect leaders that have economic know how not populist old men.
    The kwasha also is very unreliable coz of a fragile economy.
    HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH

  8. Mudala Ponyanx ine ku zed bufi. I have signed a contract nachimayo candi. Ifi I go to Zed I lose everything. Elo mudala remember I said cifwayafye lyonse.

  9. Did anyone hear what Sata said about the weakening kwacha? Its no wonder he refused to feature on race to plot 1.He does not seem to have a clue even on basic economics.

  10. The depreciation of the kwacha should not come as a suprise, all one has to do is look at the movement of other economic variables, both locally and internationally. inflation is at 14%, we are poised to miss our real GDP growth projection, interest rates have gone up, the luse all share index has been declining since march to name a few

  11. PF MP Canditate leading in kachimbiya concituence by a big margin angaist MMD’S JUDITH, The differene is about 2000 votes. Go PF Go, Pabwatooooooooooooooooooooooooooooooooooooo.viva sata.

  12. i feel this is all bcose of the uncertainty political wise,investors are holding on to foreign currency.when politicking is over,we might see the reversal of the current trend.a similar shock was experienced when we just lost the presido.all is not lost,just remove bwezani!!

  13. #16 If you do not get on the boat like me, then you will not be delivered! lol!

    Haikavotela Humwine will only be giving you hand outs which you do not need. You have to work hard. Even where you are in Soweto, work hard.

  14. This has to do with N’gandu Magande and Ruphia Banda. Ever since Magande lost to Ruphia, Things in this country have gone whired….. We will blame him for not doing his job accodingly.

  15. Mwebantu! Let’s be realistic and logical. This has little to do with our internal politics. The major issues are 1. The general appreciation of the USD against major word currencies and 2. the decline in copper prices. Magande has little to do with this and so has RPB. Zambia should, therefore elect a leader who is enlightened and is able to manage modern business. I am sure you know the only real option we have.

  16. This is simple, it is called country risk.

    Whenever there are elections the local currency weakens especially in Zambia due to uncertainty, those with access to the BOZ website can verify.

    In short companies will avoid offlaoding dollars onto the Zambian market in fear they might have to leave the country at short notice. This stiles supply and the result is increased demand and a weakening kwacha.

    Neither HH, Sata nor RB can do anything about this. If BOZ were smart they could offload dollars onto the market to prop up the kwacha but….

  17. Amazing how many morons we have on this blog, suddenly Magande is the economic version of Christ and Banda has already affected the economy?

    And to think they will allow such buffoons to vote!!

  18. #23 is right. Those who no better than reducing this to a political scene, please keep speaking so that all of us can learn. Some people may not be as enlightened so this could be one way they receive such knowledge. Others probably just chose to be naive and see everything in the eyes of politics. There’s nothing we can do about that. But I believe it is still possible to discuss issues on this blog without resolting to politics.

  19. #27, are you the only kangaroo in the land who does not know that Ngondo did not stand for this race? Wake up and see what is happening world-wide!!! Ubututu!!!

  20. #23 Zambian you are real, objective and rational.The man is well known.,but as usual people choose to close their eyes from the truth.

    VIVA HH HH HH

  21. We need a break from the corrupt governemnent by changing it,they are corupting all the way through to win,spending our tax payers money big time like we are happy,some of feel useless when we are supposed to be happy with our jobs because of taxes.

    Ati legacy and continuity which legacy?ukwiba no kubosha nayo ni legacy?Zambians lets wake up?

  22. #20 Can the Investors live in a country which is facing a crisis. For your own info. They already know that Banda is Corupt, Mind you he’s the acting President. Comming to Magande, He’s not doing his job to attract investors in the country.

  23. Thats why kuya bebele,see the pictures in the post,Nevers Mumba and his the rest of retired generals are back campaining because they have been promised with jobs,thats why we should not vote them in the first place,

    RB is not even telling us what his vision or plan is?ati continuing with what?he is going to subsidise,open and build with which money when his salary is tax free,twachula kufipuba fikabwala,i dont care who but definately not MMD,let it died like unip

  24. #34 It is called seeing the irony. Obviously not from a Zamabian no matter what.

    Ho Ho Ho. The chap is in the US. Can google and all that for 24/7.

    Ho Ho Ho.

  25. #41. The kwacha is dying too we will be talking trillions on the market like in Zimbabwe. I wonder how much the 700 billion dollars in the US crisis sounds like in Zim Dollars.

  26. Kanchibiya parliamentary bye election results

    with 8 polling stations to be counted, the results counted are:
    PF 5673
    MMD 1688
    independent 471
    UPND 78

    this will give you an indication of the presidential bye election on 30th october.

  27. Chiluba knew him,KK knew him but zambians especially bembas and easterners do not know who sata is.he is the killer and distroyer remember mezaf flat saga

  28. check out the devil you know is better so viva banda. sata followers want to have good business in coffin sales as their boss is the chief killer after working special branch as boss fo too long.

  29. TO ALL MMD MEMBERS,

    This serves to inform you that, Mpika by-election is a Kadyonko, a tip of an iceberg, you did’nt see it comming, You announced the Presidential Bye Election too early and you deliberately chose Mpika to bring down PF & Sata, because you thought they would lose, Please Wake up you relied too much on the dictates of V.J. Watch this

    THIS IS A START OF BAD THINGS FOR YOU GUYS ADIOS AMIGO – IT WAS GOOD WHILST IT LASTED AT GOVENMENT HOUSE SORRY THE RENTALS ARE OVERDUE YOU HAVE TO VACCATE

  30. Let the kwacha continue losing value and it will be worse when Sata wins. Zambians are funny people they do not learn from neighbouring Zim nor from the effects of Chiluba govt on the economy. tribalism especially by what is being seen in Luapula and Northen provinces will bring the country to its knees very soon. Sata as president of Zambia will completely ruin the economy. I blame the MMD especially Tentamanshimba for supporting headless Banda. let the kwacha continue losing please to teach tribalists a lesson

  31. #54-KASHIMANI
    So, according to you , only tribalism in Luapula and Northern provinces will bring the country to it’s knees. What about tribalism in southern,western , northwestern? For your information, there is no tribalism to talk about in Luapula or northern provinces.People who live in these areas will tell you fast enough.You dont need to be Tonga or Lozi to live and became rich either in Luapula or northern provinces because Bembas accomodate EVERYONE as long as you have a POSITIVE contribution to make.People are voting for SATA not because he is bemba.If this was so , how do you account for non-bembas on the C/BELT and Lusaka who are also voting for him?

  32. Guys,
    Voting for SATA has got nothing to do with bakaponya or tribalism.People want SATA because of what is capable of doing.He did a good job when he was Governor.He did a good job when he was health minister.He did a good job when is was housing minister.The list is endless.What he did even people with degrees and MBAs have failed to achieve up now.Guys, to run a country, you dont need MBAs & PHDs at all.At a minimum, what you need are good communication and administration skills to manage people. Period. SATA has got all these , so why can’t we give him a chance?

  33. Is Evans Chibiliti planning on becoming the next finance minister? He looks like he is very capable.
    And what about Sikota Sakwiba? Was he promised the post of vice president or a minister post? Why should he be at every campaign place with RB otherwise? Please enlighten me on this.

  34. In Zed, i paid my housegirl K100 per month, for me alone in those days a hundred kwacha could by me groceries for two weeks, 18 years later, i found K100 notes used as toilet paper in public toilets in Kapiri Mposhi.
    Now i spend K800,000 to a Million and couple of hundred thousands of Kwacha to fill up my trolly with groceries in Shoprite..
    Zambia today is a very expensive place to live, i wonder how the average citizen and families cope..

  35. # 58 I THANK YOU VERY MUCH FOR EXPLAINING. I HAVE BEEN TRYING TO LET THESE TRIBAL SENSITIVE PIPO UNDERSTAND BUT THEY STILL CANT LISTEN. BESIDES NOT ALL BEMBA SPEAKING PIPO IN ZED ARE BEMBAS PLEASE!!!!!! VOTE WISELY PIPO WANT AN EXPERIENCED WORKER AND SATA IS SUCH. MIND YOU THERE ARE 73 TRIBES IN ZED AND TONGA IS NOT DIFFERENT FROM OTHERS. WE ARE ONE. TWAPAPATA LOVE ONE ANOTHER. e.g I VE NOT FOLLOWED MY FATHER`S CHIOCE i.e. RB

  36. This man called RB is really a reckless spender. See how he’s spending on his compaign trails. Even though he is intitled to use state machinery as a sitting president (acting), does he really need to move with three helicopters? How about the presence of Sakwiba Sikota. Is the man intitled to use state machinery too? I had great respect from the man…thought he was a man of pronciples, but alas was terribly wrong. Let’s do ourselves a huge a favour and dislodge RB and his bunch gold diggers

  37. RB is the Acting President and he is entitled to use all the necessary state machinery available. The soon you accepted this fact the less chance you have from messing up in you pants. He can use ten helicopters if they are available. At least it give chance for pilots to pratice their flying skills and If there was space in the one of the helicopters, why not give it to Sakwiba? He is a zambian. And the weakening of the kwacha is not due to RB but a threat of Zambia being run by …….with an impi of kaponyas shouting pabwatoooooooooooooooooooooooooooooooooooooooo

  38. *******************************************************

    It’s times like this when you need a rational thinking Zambian like myself. Every election in any stable country causes the currency to be on the fringes, likes like the price of Ifincubala is always up after a drought; everything shall stabilise again. Even the American economy is going through a normal phase shift, this is exactly what happened in the 70’s here. Gas prices went up, then the economy was hit, the big three car companies suffered due to poor planning, Toyota took and became stronger, trust me; Toyota is the leading car company in America, believe it.

  39. So after elections all financial and Structual institutions calm down. It’s still Africa remember, thus Companies are justified to hit their panic buttons. The currency shall stabilise even gain; This only means the more money for our families back home when we send it. Here is a suggestion, we need to start buying shares on LuSE. Not only sending money home, those chaps seem to spend that cash rapidly, you guys agree. Buy them Stock and direct deposit it to their accounts with school fees attachments, or Food and living. So as the do not drink it or spend it on decadent women.

  40. Nevers Mumba is back on the scene? The chap should go back to preach. He is a failure, it is for this reason investors are running away. Rupiah Banda should not be allowed to rule that country. I think it will be difficult to rig these elections. Zambians should teach the ruling party a lesson by voting for Sata or H.H. MMD has run down that country. The kwacha will appreciate when these guys are kicked out as the fight against corruption will continue, Chiluba’s case must continue, if he is guilty through in prison. Shame MMD

  41. imwe guys, listen to HH the man is promising to help yo poor impoverished country by using his own salary. what more can u ask in a leader

  42. There is a lot of uncertainty following the elections on October 30. Of late there has been a lot of political violence reported. As a result, the business community is holding on to the forex, forcing the Kwacha to depreciate heavily.Other factors are low copper prices etc. However, in most cases regardless of the elections, Zambia has been facing depreciation in its local currency against the foreign currencies towards the end of each year. I only hope the New Govt will put in place proper fiscal policies that will enable our currency to stabilise even amidst such situations in future.

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