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The Zambian Kwacha received a notable boost in the currency market following the release of August trade data showing a dramatic surge in the country’s surplus to K3.3 billion, up from just K0.4 billion in July.
The eight-fold increase marks the largest monthly trade surplus since early 2023, reinforcing Zambia’s strengthening external position.
According to the Access Bank Group Daily Market Report, the robust trade balance was expected to provide a crucial injection of foreign exchange into the market, offering much-needed support to the Kwacha.
Analysts attributed the sharp improvement to Zambia’s recovering copper export performance.
Copper, which accounts for more than 70 percent of the country’s foreign currency inflows, has seen production rebound from last year’s drought-related constraints.
The stronger export receipts have significantly boosted foreign exchange liquidity in the domestic market.
“The timing of the surplus is particularly significant as Zambia enters the final quarter of the year, a period when seasonal import demand often puts pressure on the kwacha.
“The August performance is expected to provide a buffer against these headwinds, with the local currency likely to show more resilience than previously anticipated,” the commentary showed.
Looking ahead, market watchers remain optimistic about the medium-term outlook.
With global copper markets tightening and Zambia’s production capacity set to expand, trade surpluses are expected to remain strong.
This, combined with progress on the country’s debt restructuring programme, positions the Kwacha for potential outperformance among African currencies as structural reforms take effect.
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