By 
An economist, Kelvin Chisanga, has forecast a continued modest appreciation of the Zambian Kwacha in the short term, supported by seasonal tax inflows, strong agricultural performance, and dividend receipts from the mining sector.
The Kwacha recently strengthened to K24 per US dollar, from earlier trading levels above K28.
Chisanga noted in a statement issued in Lusaka on Sunday that improved foreign exchange (FX) liquidity—driven by the tobacco marketing season and positive market sentiment—was reinforcing this trend.
However, he warned that the appreciation could be temporary, with risks likely to re-emerge after August.
“A key concern is the anticipated rise in dollar demand as companies resume import activities and repatriate profits, particularly around mid-September,” he said.
Read more:kwacha-records-third-consecutive-monthly-gain-against-us-dollar-on-the-back-of-steady-forex-inflows
He emphasized that the Kwacha’s performance hinges heavily on external factors including copper prices, Chinese demand, IMF disbursements, and debt restructuring outcomes.
Chisanga cautioned that inflationary pressures, elevated oil prices, and increased demand for farming inputs in the second half of the year could exert downward pressure on the currency.
He also warned against any loosening of monetary policy by the Bank of Zambia, which could weaken the Kwacha further if expected forex inflows do not materialize.
“The Kwacha’s path forward will ultimately depend on a delicate balance between domestic policy discipline and favourable global conditions,” he stated.
WARNING! All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express permission from ZAMBIA MONITOR.
Comments