• The Kwacha has not been doing well.
• It has been climbing from last year December 2022.
• The currency rose sharply from the beginning of December up to mid-December 2022.
An Economist says Kwacha has been fluctuating in between gains and losses since December 2022.
Speaking when he featured on Money FM’s radio program dubbed ‘Treasury Watch,’ Mwiya Ikabongo noted that the currency rose sharply from the beginning of December up to mid-December 2022, and stabilized thereafter.
Mr. Ikabongo however said there has been a slow rise and in some cases a small decline but mainly the local unit has been on the upward trajectory, an indication that it is underperforming against major convertible currencies.
He added that this entails that the cost of imports has gone up, as cross border traders have less revenue as a result of the value which is quoted in foreign currency.
“The Kwacha has not been performing well, it has been climbing from last year December to where we are now. So it has been on a rise, it’s just a continuation of that. To anyone who is seeing, you observe that there was a sharp rise from the beginning of December all the way up to mid-December. It started to stabilize of course it was still rising but at a steady rate. So there has been a slow rise and sometimes even a small decline but mainly we have been on the upward trajectory.”
“It means that our currency is under performing against major currencies and this can only mean that the cost of buying things across imports has gone up, hence you have less revenue if you are an importer because the cost of getting those things from outside has gone up as a result of the value which is quoted in dollars,” Mr. Ikabongo said.
According to a commercial bank, last week’s Foreign Exchange trading saw the Kwacha trade on the back foot against the US dollar as the market continued to experience a pick-up in hard currency demand amid dwindling supply.
The currency pair opened trading at K18.08/18.12 per US dollar on Monday morning, and by the close of business on Friday, it was quoted 0.68% weaker at K18.20 and K18.25 per US dollar on the bid and the offer, respectively.