Kwacha to continue losing value next week

The Zambian Kwacha is expected to weaken further in the week ahead due to electricity outages  and slightly due to a slowdown in China, a key importer of its commodities.

Traders predict the Zambian kwacha will remain under pressure next week on concerns about an electricity shortage that has hit Africa’s No.2 copper producer and slow growth in China.

On Thursday the kwacha was bid at 10.5750, weaker than last week’s close of 10.0300. The kwacha has broken through a series of record lows this year, weakening by close to 40 percent according to Reuters data.

“The power deficit and as such the higher cost of production poses a threat to the kwacha. The slowing Chinese economy and its obvious impact on copper has continued to have a negative impact on the unit,” the local unit of South Africa’s First National Bank (FNB) said in a note on Thursday.

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