Kwacha Gains on Market Confidence


Positive sentiment reflects improving economic outlook

By Francis Maingaila ♥️ 
Lusaka, Zambia24 — (8 January 2026) — Growing market confidence driven by strong foreign exchange inflows, disciplined economic management and positive investor sentiment has strengthened the Zambian Kwacha, signalling an improving long-term economic outlook, economist Kelvin Chisanga has said.

Chisanga said the renewed confidence in the economy has seen the local currency appreciate by 12.2 per cent over the past month and by 25.8 per cent over the last year against the United States dollar, reflecting increased stability in the foreign exchange market.

He explained that technical indicators point to a short-term bullish trend for the Kwacha, supported by a pattern of higher highs and higher lows, which has helped sustain the currency’s recent gains.

According to Chisanga, momentum indicators remain positive, with moving averages and the Moving Average Convergence Divergence (MACD) reinforcing the upward trend, while the Relative Strength Index (RSI) is approaching mildly overbought levels, indicating strong demand for the local currency.

He attributed the improved market confidence to steady foreign exchange inflows from the mining sector, particularly copper exports, alongside disciplined fiscal and monetary policies that have stabilised the market.

Chisanga further said improved coordination between monetary and fiscal authorities has reduced speculative pressures, eased exchange rate volatility and lowered inflationary risks for businesses reliant on imported inputs.

However, he cautioned that the Kwacha remains vulnerable to external shocks, including global commodity price fluctuations and tighter international financial conditions that could affect capital flows.

Chisanga said sustaining market confidence and long-term currency stability will depend on continued policy consistency, export diversification, prudent reserve management and deeper structural reforms aimed at boosting domestic productivity.

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