IMF team in Zambia to review economy as kwacha slides - CNBC Africa

IMF team in Zambia to review economy as kwacha slides

Southern Africa

by Reuters 0

Zambia's kwacha fell to a low on Tuesday but recovered slightly to trade up 1.44 percent. Photo: Wikipedia

An International Monetary Fund (IMF) mission arrived in Zambia on Wednesday to meet officials for a scheduled review of the economy as it grapples with a sliding currency tracking falling copper prices.

Zambia's kwacha fell to a low on Tuesday but recovered slightly to trade up 1.44 percent at 13.6900 against the dollar by 1000 GMT.

The country's dollar bonds also fell across the curve as copper prices edged towards a six-year low on concerns about flagging demand in top consumer China.

"We are just reviewing the economic situation since the last meeting," Secretary to the Treasury Fredson Yamba said, referring to the IMF visit to Africa's second-largest copper producer in May.

"We had agreed to meet towards the end of the year, we are not discussing a programme with the IMF," Yamba added.

The IMF said in May that Zambia's economy had strong growth potential but risked being weighed down by persistent weaknesses including large fiscal imbalances, lower copper prices and policy uncertainties

The central bank raised its benchmark lending rate by 300 basis points to a record 15.5 percent on Nov. 3 to curb inflation, which nearly doubled last month as the kwacha fell.

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