BoZ Cuts Policy Rate to 13.5%



Sharp decline in inflation and improved outlook prompt easing of monetary policy

By Francis Maingaila ♥️ 
Lusaka, Zambia — February 10, 2026
The Bank of Zambia (BoZ) has reduced the Monetary Policy Rate by 75 basis points to 13.5 percent following the Monetary Policy Committee (MPC) meeting held on February 9–10, 2026, the central bank announced.

Bank of Zambia Governor Dr. Denny Kalyalya told journalists at the media briefing that the decision was informed by the sustained decline in inflation in the fourth quarter of 2025 and the sharper-than-anticipated fall recorded in January 2026, which provided scope to ease the monetary policy stance.


Dr. Kalyalya said annual inflation slowed to 11.2 percent in December 2025 from 12.3 percent in September 2025, before dropping further to 9.4 percent in January 2026, largely driven by the continued effects of the 2024/25 maize bumper harvest and the appreciation of the Kwacha against major international currencies.

He said the Bank now projects inflation to fall into the 6–8 percent target band faster than previously anticipated, with inflation expected to be within the band by the second quarter of 2026 and to move towards the lower bound by the second quarter of 2027.

Dr. Kalyalya said inflation is projected to average 6.9 percent in 2026, revised down from the 7.6 percent forecast in November 2025, and to ease further to 6.3 percent in 2027, reflecting the lagged effects of exchange rate appreciation and expected favourable agricultural output.

He said risks to the inflation outlook remain tilted to the downside, supported by favourable weather conditions, higher copper prices, and continued macroeconomic stability.

Dr. Kalyalya said, in view of the sharp drop in inflation, improving market expectations, and the projected disinflation path over the forecast horizon, the Monetary Policy Committee resolved to cut the Policy Rate by 75 basis points to 13.5 percent.

He said decisions on the Policy Rate will continue to be guided by inflation outcomes, forecasts, and identified risks, including those related to financial stability.

Dr. Kalyalya said the February 2026 Monetary Policy Report, which provides detailed analysis of recent macroeconomic developments and the inflation outlook, will be published on the Bank of Zambia website by the end of the month.

He said the next Monetary Policy Committee meeting is scheduled for May 11 and 12, 2026.

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