• The Kwacha is depreciating by 0.3 to 0.4 percent against major convertible currencies every week.
• In 2020 the local unity stayed on the back foot due to the supply of foreign currency being lower than the demand.
• Negative sentiments arising from Zambia’s default of two Euro bonds coupon payments.

An Economist says the Kwacha is depreciating by 0.3 to 0.4 percent against major convertible currencies every week.
Dr Patrick Chileshe told Money FM News in an interview, that in 2020 the local unity stayed on the back foot due to the supply of foreign currency being lower than the demand which is excessive, following the purchase of crude oil and Agricultural products under the Farmers Input Support Program (FISP) program.
“The exchange rate in 2020 had been on the back foot, largely because on the market the supply of the foreign currency is far lower than the demand,” he said.
He said the US Dollar is also seen a lot of demand from the private sector that want to import goods and services to be sold on the Zambian market, which is hence having a negative impact on the Kwacha.
Dr Chileshe further noted that the other factor that has contributed to the depreciation of the Kwacha, are negative sentiments with regards to the local financial markets, following Zambia’s default of two Euro bonds coupon payments that include the 42.5 Million dollar payment and the 56 Million dollars which are painting a negative picture to would be investors.
“Negative sentiments with regards to local financial markets, Zambia has so far defaulted on two Euro bonds which are painting a negative picture to would be investors,” he said.