Zambia’s inflation rate has dropped below the 10 per cent mark for the first time since 2023, offering relief to consumers and policymakers as price pressures continue to ease.
Annual inflation fell to 9.4 per cent in January, supported by a stronger kwacha and a slowdown in both food and non-food prices.
The local currency has gained about 16 per cent since December, buoyed by tighter central bank controls on foreign-currency use and a rebound in copper prices. Copper is Zambia’s main export and a key source of foreign exchange earnings.
With improved export revenues and stronger foreign reserves, inflationary pressures have continued to soften, reinforcing optimism about macroeconomic stability.
The outlook has also been boosted by Zambia’s successful completion of an International Monetary Fund (IMF) financing programme, which has opened the door to discussions on fresh support. Analysts say any new IMF backing could further strengthen the kwacha and stabilise prices.
The improving inflation trend has raised expectations that the Bank of Zambia may extend its interest rate cuts as early as next month, as authorities balance price stability with efforts to support economic growth.
