Saturday, April 20, 2024

Zambia’s Kwacha Emerges as Top African Currency against USD in 2024

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Zambia’s kwacha has emerged as the top-performing African currency against the U.S. dollar in 2024, surging by 13.8% to 22.8 against the greenback. This increase is attributed to the aggressive monetary policy tightening by the central bank, which included raising commercial banks’ reserve ratios and hiking interest rates. However, analysts emphasize that sustained strengthening of the kwacha depends on attracting more foreign investment.

Last November, the Bank of Zambia raised the statutory reserve ratio for deposits in both local and foreign currencies by 3 percentage points to 14.5%. Despite government efforts to boost the sector, declining copper production, a crucial source of foreign exchange, has also impacted the currency’s performance.

Bank of Zambia governor Denny Kalyalya highlighted measures taken to address excessive demand, particularly from the mining sector. He emphasized the importance of increased foreign currency flows for further gains in the kwacha.

Although the kwacha has weakened slightly this week, economists expect stabilization around 21-22 per dollar. The government is finalizing arrangements for new investors to take over key copper mines, aiming to attract additional investment.

Analysts stress the importance of fiscal consolidation and balance of payments reform to establish an attractive policy environment and address structural imbalances. The conclusion of external debt restructuring is also seen as crucial to unlocking investment flows into the country.

23 COMMENTS

    • THE KWACHA STRENGTHENING IS FAKE!!!! IT IS BEING MANIPULATED AND IS NOT SUSTAINABLE. MUSOKOTWANE KNOWS THIS VERY WELL. SOON IT WILL CRASH AGAIN.

    • The drought is now a reality. The maize that Edgar had kept in reserve at FRA was exported to boost the dollar.!!!
      Now we have to import the maize again NOW! NOT TOMORROW! because all countries in the drought areas wil be competing for the same grain….this will put pressure on the Kwacha
      Secondly , the country will have to buy electricity from somewhere because of the drought. This will also put pressure on the kwacha
      Thirdly we are not managing the debt restructuring the debt….. dollar is also flying out to service the debt. More pressure on the kwacha.

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    • They got it right. They then got it all wrong. Soon they will get it wrong again. The cyclical on/off means they can not do it systematically right, except depending on haphazard chances. Is it normal for a currency to either gain or lose by 20% in a day and only at 14 hours? Who really is keeping our money?

  1. Meanwhile things are not moving poverty is on the increase so what is the beneffit, only those trading in the dollar are the ones benefting.You missing some thing, bring more forex in our country and not injecting dollars cos the only means that it is artificial,just for short period and this is not the first time it has happend.

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  2. Meanwhile things are not moving poverty is on the increase so what is the benefit, only those trading in the dollar are the ones benefting.You missing some thing, bring more forex in our country and not injecting dollars cos that only means it is artificial,just for short period and this is not the first time it has happend.

  3. How does Bloomberg say this for just a week of it’s performance, from worst to best and back again, this is complete madness…a currency’s performance is determined over at least a quarter of a financial year and if we look at how the Kwacha has performed this last quarter it is nothing short of a complete disaster. It was at K26 to the USD at the end of the last quarter, only two weeks ago it was at K27.8, so what is this they are talking about?

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  4. After pumping dollars in circulation to create an illusion that things are better and yet prices are still historically high. Upnd are dogs

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  5. There is totally no correlation between this seemingly good news and the opposite reality on the ground, it can even buy/sell on one on one with the dollar but prices of goods and services will still remain high. Quote me next week when you hear the justification as to why fuel will not reduce or may reduce marginally despite the above bulish performance.

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  6. What time is it? We have a variety of 14 hours.
    This is the third time our currency is best performing and the third time too when it is called worst since the current government assumed office. Nothing new. Same old crap.

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  7. The truth is all African economies are micro managed by the west….look at how poor Bukina Faso is….look at how poor Niger is…but look at the presence of bazungu in Bukina Faso and Niger…what is their interest in a poor country….busy stealing natural resources and inciting ethnic divisions

  8. Short lived. That’s what happened last time. One minute the kwacha was best performing currency and the next it was the worst. Same thing gonna happen again. The cycle begins.

  9. We really need Africans to wake up and fend off these demonic news from the imperialist. Best performing cure Nn y in 2024 and yes this is just the second month of the year. When you see the west praising you then you know you are not useful for your own people. You are useful in many respects for them( the west).

  10. THIS IS LAZY THINKING!
    WE SHALL APPRECIATE A STRONG KWACHA ONLY WHEN PRICES START REDUCING AND GO ON REDUCING TO AFFORDABLE LEVELS.
    PLEASE STOP INSULTING THE SUFFERING PEOPLE
    YABA!

  11. This means that HH’s policies and sound economic programs are working well . Tis much unlike PF’s 10yrs of depressing economic indicators with debts increasing and ever shrinking GDP.

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