Home Economy Kwacha hits weakest level in 7 months as World Bank drops Zambia’s...

Kwacha hits weakest level in 7 months as World Bank drops Zambia’s GDP Growth Forecast

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The market has shown poor trading for the kwacha, the national currency of Zambia, as the exchange on Thursday closed at K12.400 per dollar – the lowest price that was previously seen only in October 2018. In addition, the ZAR/ZMW rate also dropped, crossing only a 0.880 mark by the end of the day.

That was a reflection of World Bank’s cutting of Zambia’s Gross Domestic Product (GDP) growth forecast from 3.5% to 3.3%. According to experts, the worsening scenario for Zambia is highly likely to continue, if the sphere stakeholders make no efforts to resolve it.

“If the local unit continues to trade on the back foot against the dollar, it could have an impact on the MPR and inflation rate. We are of the view that without any significant dollar flows into the market, a bearish kwacha will continue…,” FNB Zambia stated in its market report on Friday morning.

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