Economist Jonas Shakafuswa says he expects pressure on the Zambian economy to easy going into the 1st quarter of next year after the price of copper shot up to $5900 per Metric tonne.
Mr Shakafuswa said he anticipates a higher increase if American President elect Donald Trump will honor his words of taking troops back to the Middle East, a general war on ISIS.
“Unfortunate as war is, it increases the demand for our commodity. For the Zambia economy this triggers a number of increased economic activities. Will we relate it to the global environment or that (Edgar) President Lungu has worked,” Mr Shakafuswa said.
He said depending on the advice of the Bank of Zambia, the country might enjoy a very favourable exchange rate.
He added, “Business associated with mining will boom. Direct local and foreign investments with add to the supply of forex. Let us pray for recovery in Jesus’s name.”
But Reuters reports that Copper futures fell on Tuesday during Asian trading, pulling the London contract lower, as traders cashed in gains after last week’s dramatic price spikes supported by Donald Trump’s U.S. presidential election victory.
Three-month LME copper fell 3 percent to $5,417 a tonne after earlier building on overnight gains.
The decline marks a reversal from the nearly 8 percent leap in intraday trading on Friday to its highest level since June 2015.
Copper recorded its best weekly showing last week since 2011 with an 11.2 percent gain, a rally that was also buoyed by U.S. President-elect Donald Trump’s promises of infrastructure spending.
The meteoric rise of copper last week, which was up 20 percent at one point, was not justified by fundamentals and the metal used mostly in power and construction was due to retreat.
Trump has said he plans to fix inner cities, rebuild highways and infrastructure, while erecting barriers against cheap imports, leading to higher consumption of industrial raw materials.