Agriculture expected output, balanced aggregate growths to feed escalating inflation!
Former Football Association of Zambia (FAZ) President Kalusha Bwalya with former Republican Vice President Dr. Guy Scott in 2013
Agriculture expected output, balanced aggregate growths to feed escalating inflation!
By Kelvin Chisanga Zambian Economist and Communications Specialist – +260979305194
Saturday, 21st May, 2021
Monetary policy rate has been maintained at 8.50% by the Bank of Zambia for a good reason and this is mainly to allow full effect of the policy following a number of noble performance outturn factors on the economical scoreboard, as the rate poses a grander path to economic recovery although at a slow pace. Though, I personally feel that first quarter monetary policy is basically shadowed by a sustained reduced scale of trade recorded on the microeconomic levels.
There has been a serious concern which we are able to see in a sharper inflation points especially on the business’ input costs owing to factors associated with seasonal demands as the aggregate started slowing down on the pace, and we essentially expect output prices to start moderating positively in the short to medium based on the expected harvest, so inflation will definitely start to feed into agricultural output soon.
Kelvin CHISANGA farming
Recently, the month of March saw some improved economic activities amid current prevailing market conditions, this is attributed mainly on the account of improved business confidence that started being seen from a number of areas such as sustained copper demand, relative balance of private sector’s participation that fostered business growth emanated from new orders that came on the seen and in full swing, following the slow pace participations witnessed in both the month of January and February 2021.
It is gratifying to state that most business entities in the nation responded pretty well to signs of improving customer’s demand by raising their purchasing activity during the month of April, on an account of continued escalation efforts made from the month of March following the effects expected to trigger from the February monetary benchmark set by the apex bank.
Kwacha looks promising though moderating at a slow pace, meanwhile the local currency has shown relatively positive effects as the levels of depreciations were narrowed and will in the short-medium term likely to collect a boost based on the outwardly improving business conditions though the projections is not pretty clearly as we equally face a number of downside risks with some potential setbacks projected from the energy sector coupled with political events.
It is rewarding to hear that the reserves have steadily increased its levels of portfolio, the policy rate has therefore been set up to a good test as expected before and we highly expect the next monetary policy rate to be determined on current continued prevailing fundamentals in the economy.
Kelvin CHISANGA
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