Weekly Economic & Financial Recap, 1st Edition
ZCAS Economics & Business Association (ZCASEBA)
Empowering Tomorrow's Leaders: Nurturing Excellence in Economics and Business
1.????? Bank of Zambia Introduces New K500 and K200 Notes, Converts K5 & K2 to Coins?
The Bank of Zambia (BoZ) has announced significant changes to the country’s currency structure, effective March 31, 2025. The changes include the introduction of K500 and K200 banknotes, while the current K5 and K2 notes will be converted into coins. This move is aimed at improving cash handling efficiency and reducing the wear and tear of frequently used lower denominations. https://x.com/BankofZambia/status/1889328429436117289?s=19
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2.????? BoZ Raises Monetary Policy Rate to 14.5%?
In its latest Monetary Policy Committee meeting on February 10-11, 2025, the Bank of Zambia increased the policy rate by 50 basis points to 14.5%. The decision aims to curb inflationary pressures and bring inflation back within the 6-8% target band. This adjustment is expected to influence borrowing costs and credit market conditions across the economy. https://x.com/BankofZambia/status/1889682957457060046?s=19
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3.????? 2025 Constituency Development Fund Disbursement Begins?
The Zambian government has released K426 million to 47 constituencies under the 2025 Constituency Development Fund (CDF). The Ministry of Local Government and Rural Development emphasized that the funds, which cut across ruling, opposition, and independent constituencies, are meant to drive community-based development and should not be politicized. https://www.facebook.com/100064549037984/posts/pfbid02Dfx29B6iJoxuc9yARNcz7dUf8dVnB8rQymndoRsCmfJoga5tBxk4McQiH4NbjoHAl/?app=fbl
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4.????? Gross International Reserves Rise to $4.31 Billion?
Zambia's foreign reserves increased to $4.31 billion (4.6 months of import cover) at the end of December 2024, up from $4.15 billion in September. The increase is attributed to inflows from the World Bank, African Development Bank, and the IMF’s Extended Credit Facility (ECF), alongside mining tax revenues. Additionally, gold purchases in Q4 2024 amounted to $7.9 million, raising the total market value of gold holdings to $225.1 million.
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5.????? Credit Growth Slows Amid Economic Uncertainty?
Year-on-year domestic credit growth dropped to 5.4% in December 2024, down from 11.8% in September. Private sector credit expansion also slowed to 20.7% from 29.7%, reflecting subdued economic activity and the impact of drought conditions. Meanwhile, lending to the government through securities declined despite improved liquidity conditions. https://x.com/mofnpzambia/status/1889702386274271666?s=19
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6.????? Government Securities Market Update?
The total outstanding stock of government securities reached K229.37 billion at the end of December 2024, with non-resident holdings accounting for K57.64 billion (25.1%). The steady participation of foreign investors in government securities suggests sustained confidence in Zambia’s financial market. https://x.com/mofnpzambia/status/1889702390233784422?s=19
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