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Kwacha in record crash, trades the lowest in 30 years, depreciates to K25/US dollar


The Kwacha has depreciated the lowest since the post economic liberalisation era to K25 per United States Dollar.

This is despite the Copper, the main foreign exchange earner for Zambia gaining 2.5 per cent on the London Metal Exchange.

According to Absa Bank Zambia Daily Indicative Rates, the Kwacha is being quoted in the range of K24.57 and K25.05, buying and selling respectively.

This is despite the recent measures by the Bank of Zambia to restrict money supply through the Monetary Policy Rate, among other interventions.

According to ZANACO Newsletter, the Kwacha on the bid and offer indicative spot rates was selling and buying in the range of K24.52/25 respectively.

Zanaco noted the local unit would in the short term likely to trade on the back foot due to muted Dollar supply.

Experts see the continued depreciation of the local currency against major convertibles as result of delayed debt restructuring conclusions.

But others say failure to galvanise the mining industry to gain more from the extractive sector would continue having a ripple effect on key economic fundamentals.

Recently PricewaterhouseCoopers (PwC) Zambia Country Senior Partner, Andrew Chibuye, said the current depreciations posted by the Kwacha Bank are mainly because of the low performance of the mining sector.

Chibuye said the overall foreign currency generated from exports was currently under pressure largely owing to the performance of the mining sector thus causing the depreciation of the Kwacha.

He added that the depreciation of the Kwacha was also affected by the high demand for imported goods and services such as petroleum, fertilizer and other inputs for sectors like manufacturing.

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