Currency Comeback: What’s Powering Zambia’s Kwacha Surge?

By Joana Ndabala

Zambia’s currency, which had previously weakened to almost K30 against the US dollar, has now appreciated to around K23.38.

Experts say, the improvement is attributed to a favourable macroeconomic environment increased local demand for the kwacha, and a strong performance in agriculture. The macroeconomic environment refers to the overall state of a country’s economy, including inflation, interest rates, exchange rate, economic growth, employment, and government finances and how it affects people, businesses, and government activities.

With these positive trends, experts suggest Zambia is on a path toward economic recovery, improved investor confidence, and better living standards for its people.

In a statement, the Economics Association of Zambia (EAZ) has attributed the economic rebound to stronger performance in the agricultural sector, which has resulted in increased food production.

According to Dr. Osward Mungule, President of the Economics Association of Zambia, other contributing factors include, the Bank of Zambia’s policy rate, which has helped maintain economic stability, resilience amid global economic uncertainties, such as rising oil prices and geopolitical tensions.

“High local demand for the Kwacha in both trade and domestic transactions reflects growing confidence in the currency and the overall economy,” the statement reads.

Dr Mungule added that despite ongoing global economic challenges — including geopolitical tensions and rising oil prices — Zambia’s economy remains robust.

Joana is on a three-month internship at MakanDay after winning the inaugural MakanDay Award for Overall Best Student in Specialised Reporting at the ZAMCOM 7th Graduation Ceremony.