Zambian interest rates hold at 12%

Zambia decides to leave interest rates at 12% despite the decline in the kwacha. The currency weakness can be attributed to declining copper prices, which has produced a growing current account deficit.  Inflation is now 7.8% but is expected to abate over the course of the year.

Both Zambia and neighboring Malawi issue kwacha.  Malawi has much higher inflation, 24.6%. Some forex traders may liken a Kwachazone to the Eurozone except that the Malawi and Zambia each issues its own kwacha. Otherwise, Zambia might be compared to Germany and Malawi to Greece.