Leader of the Green Party Peter Sinkamba says it is inaccurate to attribute the recent sharp appreciation of the Kwacha to Government’s austerity measures.
Mr Sinkamba said there has been some excitement and celebration within the camp PF triggered by some temporal appreciation of the Kwacha, which traded up to as low as K9.50 per dollar.
He said according to people in the PF, the Kwacha gain was as a result as austerity measures put in place by President Lungu.
“Austerity measures? My foot!” Mr Sinkamba said.
He said in the long term, a strong currency depends on economic fundamentals.
“To have a stronger exchange rate, a country will need a combination of low inflation, productivity growth, economic and political stability. In short, government will need to try supply side policies to increase competitiveness and cut costs of production. This is not the case at the moment. The PF Government has failed on this score,” he said.
“Put simply, the temporal gain of the Kwacha had nothing to do with austerity measures which government has put in place (if any at all). It is simply a seasonality issue. The month of April marks the worst month of the year for the US Dollar. The commodity currencies have typically rallied sharply during April. You may call it “global”, if you like.”
“If it was an issue of policy intervention, why has the rate decayed from K9.50 to K10.50 within hours?”
“Put simply, FX market participants have displayed increasing fragility with respect to US Reserve Bank’s policy shifts. And with several Reserve Bank meetings due at the end of the month – the April 21 ECB meeting, the April 27 FOMC meeting, and the April 28 BOJ, it is entirely possible that April’s seasonality trends will remain distorted.”
Mr Sinkamba said the end of the month concentration of major central banks’ meetings obviously represents a major potential catalyst to send markets off their trends, short-term or long-term alike.
He said the country is likely to see the Kwacha-Dollar rate souring starting the month of May.
I did not know the gentleman comprehends economic issues this well. If you have dollars, hold onto them because the appreciation is temporary. We all want the Kwacha to be strong; good for our pension holdings; value of our deposits. It is, however, foolhardy partying around what is not holding. There is expected rise in interest rates in the Anglophone region and this will push demand for the pretty soon. Let us just work hard on the real economy to beef up supply.
It is clear the PF are manipulating the Kwacha value. You can tell by the infertile excitement by the Chief Givt Tribalist, Chishimba Kambwili. Understanding of economic fundamentals by Edgar and his minions is ZERO!
This opposition are insulting, I like them better than the fighting PF.
GBM was like baffikala, and Sinkamba adds .. Kwacha my foot!
Idyiot Sinkamba. Don’t smoke hashish and come to utter rubbish here. Your brain is just a sewage full of water and feacal matter
That’s the truth. I never knew that this guy can articulate issues like this. Unlike Kudo who spews nonsense all the time.
If it’s them doing it by their work it will show, they’re still in power till August. PF are praise seekers indeed. When kwacha loses value they give examples of the rand, by the way hasnt the rand appreciated too?
Kudos, are you concious that human beings are rational beings and normal. Just wondering if you are with us or you are less one?
Maybe it’s the $1 billion investment from the foreign investors Glencore – question nomba ni what has PF promised them? Another 20 years unlimited free electricity?
PF cadres will rubbish this data, what do you expect from a bunch of illiterates with Kambwili as a genius!
Baba Sinkamba, you are too quick to come out of your vegetable garden. Whatever little gain that appears towards the positive is worth noting. With your explanations, the Indian rupee, the Kenyan Shilling, the South African Rand, the Bostwana pula all these currencies do not seem to behave as bullish as the Kwacha has been doing this week. Why would the Kwacha only be benefiting from your analysis than all these currencies I have listed among others?
I amazes me that only in Zambia is the currency a political issue. In Canada the elections just went by without anyone making the price of oil of the value of the currency being an issue. These are left to the free market. HH couldn’t influence the exchange rate or the price of copper no more than he could influence the amount of rain. Advanced economies have been going through the same difficulties over the last year.
Ba Kudos whoever you are, please refrain from insults. Discuss policies not insults my brother/sister. There is no reward in insults. We are all human beings and created in the image of God. Refrain from insults and discuss policies.
Tell gbm the same and see if Upnd will be there tomorrow.
..when a lie is told over and over it starts to sound true, when something wrong stays with for a while it starts to look right …..the idea strength of Kwacha is supposed to be K1 to a Dollar…1 to 1….since it was for along time between K3.50 and K4.80 to a Dollar…we took it to be a good and fair rate….now this time someone is referring K9.50 as low….’traded up to as LOW as K9.50 to a Dollar’….as LOW….its still blurry HIGH….
…the other day a cousin of mine was celebrating the fact that for two days, power was off only for 4hrs instead of 10hrs on each day…..hey, power is supposed to be available 24/7 whats so exciting about 4hrs load shedding..??
..sorry….I meant to say..’the ideal strength…’
Totally agree with you
Such gains don’t assist local production. Zambians mustn’t celebrate the ability to import stuff. Most Zambians just want to buy cars. Produce maize wheat sunflower and coffee for export. We should be taking advantage of the low Kwacha rate to produce various stuff
That headline is nonsense!
No sub editor worth their salt would come up with such a mish marshed headline unless they have never learnt their trade
Bashi mwana ba Sinkamba, taleni mwaikala fye. You are irrelevant. At least concentrate concretely on how Zambia can benefit economically without social undertones from your mbanje theory. Don’t just talk to be heard. Be relevant!