KWACHA DEPRECIATION SLOWS DOWN FURTHER
… this follows an improvement in the supply of foreign exchange, mostly from foreign portfolio investors and mining companies.
Lusaka … Wednesday, September 01, 2021 [Smart Eagles]
The depreciation rate of the Kwacha against the US dollar reduced further to 3.6 percent to an average rate of K22.41 in the second quarter compared to 4.4 percent in the first quarter.
This follows an improvement in the supply of foreign exchange, mostly from foreign portfolio investors and mining companies.
On a net basis, foreign financial institutions increased their foreign exchange sales in the market to US$452.3.million from US$13.2 million.
In a similar vein, the mining companies supplied a total of US$573.3 million, of which US$374.9 million was directly remitted to Bank of Zambia as tax payments.
To moderate exchange rate pressures, the Bank of Zambia sold US$35 8.2 million compared to US$259.7 million in the previous quarter.
Recently the Kwacha has appreciated sharply mainly due to significant inflows from non-resident investors in Government bonds and imnroved market sentiments. Between July 1 and August 31, 2021, the Kwacha strengthened by 29.6 percent to K 15.94 per US dollar.
This is according to Monetary Policy Committee statement issued by Bank of Zambia Governor Christopher Mvunga.