New Heritage Party wants govt to explain sudden turnaround in the fortunes of Zambian currency, Kwacha

The opposition New Heritage Party (NHP) has challenged government to explain why the kwacha has suddenly rallied strongly against major currencies and moving from about K22 to a $1 down to K17.40 Ngwee to one dollar within a week.

Party President, Chishala Kateka, said sharing information regarding the cause of foreign exchange rate movements will enable the business community to make informed decisions.

Kateka has also warned that one-off interventions will not sustain the exchange rate at an adequately low level and the rate will trend upwards again as soon as the effects of that intervention wears off.

She said what will sustain the exchange rate is embarking on economic activities, that can generate adequate foreign exchange for the nation.

“In the last few months, we have seen the Kwacha go into free fall, and then rallying against major currencies rather rapidly. The cause of the loss and the rapid exchange rate gain, has not been explained to the public by those that should and as a result, the cause of the losses and gains are left to conjecture,” Kateka said.

She said the country has seen celebrations, in some quarters, to the effect that the exchange rate has come down however before the party can join in those celebrations it has a number of questions for the UPND government.

“Is this as a result of Central Bank intervention (releasing some dollars in the economy)? Have we embarked on some venture that has started to generate foreign exchange? Have we received an injection of funds in the economy?” Kateka has questioned.

She said one-off interventions will sustain the exchange rate at an adequately low level and the rate will trend upwards again as soon as the effects of that intervention wear off.

Kateka said sharing information regarding the cause of foreign exchange rate movements will enable the business community to make informed decisions.

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