With private sector pulse numbers for African nations due on Monday 04 November, Zambia’s factory readings for October are expected to slide deeper in contraction. Last printed at 48 in September, Africas red metal hotspot is forecast to print PMI at between 46-47.
This forecast is exacerbated by rising risks to inflation weighed by energy poverty the copper producer faces which is elevating the cost environment for manufacturing. Zambia has been in the doldrums for 12 months in a row weighed by high fuel costs, lack of liquidity, weak aggregate demand and lack of orders.
Purchasing Managers Index (PMI) is a monthly proxy for gross domestic product and with a waning PMI number, GDP could come under pressure. Zambia’s growth forecast was earlier trimmed to 2.2% from 3.1% given actualization of risks to growth.
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