September manufacturing activity for Africa’s second largest copper producer rebounded to positive territory as pandemic risks fade and positive sentiment rallied the Kwacha giving factory costs significant reprieve. According to Markit Economics latest Purchasing Managers Index (PMI) headline readings, Zambia’s September posture levitated to positive zone, rising to 50.3 from 49.8 in previous month as business conditions improve since April (50.1). 50 is the benchmark for expansion (>50) and contraction (<50). READ ALSO: Post Election Kwacha Winning Streak to Uplift September Manufacturing Pulse (PMI) The period August to September saw a post election currency rally with a 16.8% winning streak…
Author: The Editor
In a ministerial statement to parliament on October, 05 MinFin head Dr. Situmbeko Musokotwane pondered on one of the worst economic blunders Zambia has made in the last decade. “The growth of external debt from less than $2 billion in 2011 to its current levels of about US$14.5 billion reflects one of the worst economic blunders during the last ten years and it has significantly contributed to the suffering we see today: The government was unable to hire key personnel like teachers, the exchange rate depreciating, rising inflation and many more,” Musokotwane said. As a consequence of excessive debt, the…
It has been a very positive and epic week for Zambia characterized by talk of Republican President Hakainde Hichilema’s debut appearance at the United Nations General Assembly (UNGA) a week ago. Other metrics for the month such as inflation reported by the Zambia Statistics Agency (ZSA) are ebbing fast with September print at 230 basis points lower to 24.4% as base effects and lagging effects of currency strengthening weigh in. The post election bond rally that sent the currency on a winning streak gave momentum to economic activity through an opportunity for businesses to claw back eroded growth induced by…
September inflation in Africa’s copper producer has extended its ebbing trajectory with the latest release by the Zambia Statistics Agency – ZSA at 230 basis points lower at 22.1%. According to a Zamstats report for September, annual inflation slowed on the back of a deceleration in food prices to 29.6% from 31.6% while non-food prices rose at a slower rate of 13.6% from 16.3%. Zambia’s macroeconomic environment has seen a strengthening of currency by 16.7% to 15.9 for a unit of dollar after which it started to climb back and is shy of 17 for a unit of green buck.…
Exactly 13 months after being laid off as central bank governor, Dr. Denny Kalyalya has bounced back as monetary policy head at the Bank of Zambia (BOZ). This follows a press release from state house confirming his appointment on September 27. Kalyalya’s contract was terminated the Saturday of August 22, barely 3 days after the penultimate rate decision meeting of 2020 that cut rates 125bps to the lowest ever at 8% and was replaced by former Christopher Mvunga, a certified accountant and former commercial banker. This decision was seemingly not received well by a subtle statement from the IMF expressing…
This week the IMF mission team commences its technical assessment of Zambia. This will be the first visit to the copper producer after the August polls. Under new leadership it is vivid that policy changes are inevitable in various sectors ranging from mining to energy. The IMF announced last week that a team would court Zambia to catch up on latest macroeconomic developments. READ ALSO: Zambia’s engagement strides with the IMF fuels optimism The last update was that the IMF had agreed a macroeconomic framework with Zambia but the political will to implement the agreed actins would determine when a…
Africa’s copper producer, Zambia has made significant strides in its sentiment restoration journey over the last 40 days. This follows the successful election of Hakainde Hichilema as Zambia’s 7th Republican President, taking over from Edgar Lungu. The period has seen a rally in the both local and international bonds while the currency has reversed most of the losses hemorrhaged over the pandemic period. The Zambian delegation at the 76th United Nations General Assembly led by Hichilema utilized the trip to meet multilateral chiefs such as David Malpas Head of the World Bank and Kristalina Georgieva Managing Director of the International Monetary…
The COVID19 pandemic and climate change continue to shape global complexity as top two threats competing for resource wallet. However what remains critical is that key partnerships and deepened integrations remain the solution to these hurdles. In his debut speech to the 76th session of the United Nations General Assembly in New York, Zambia’s head of state Hakainde Hichilema echoed the red metal producers commitment towards climate change threats to the environment. “Zamia is alive to the United Nations role in guiding the world on the Sustainable Development Goals – SDGs 2030. These set the tone and benchmark for countries…
For a jurisdiction as Zambia that has borne the brunt of fiscal fragilities costing it a favorable credit rating and waned sentiment, the United Nations General Assembly attendance in the United States is proving more beneficial for the copper producer than the Talibans. Asides Evergrande quagmire that roiled markets, a Lehman Brothers deja vu scare – that has now subsided, everyone this week has their eyes fixed on the 76th session of the UN General Assembly for global direction especially vis the SDG’s. The trip to Washington has for the Southern African nations lean delegation shown the importance of the…
One positive externality of the recent Kwacha bond rally euphoria, is that the yield curve has significantly flattened over the last one month and credit markets are already pricing in lower cost of lending. The government securities (bond) curve has climbed down by an average of 825 basis points (bps) across the fixed income spectrum as both offshores and onshore players do tap into lucrative yields given subsiding political risks and widening confidence post the August 12 polls that saw Hakainde Hichilema ascend to Presidency. READ ALSO: Kwacha Bond Rally Euphoria Persists, Hunters Yield Harvest Fading Most of the hype…