Foreign Participation Continues Boosting Zambia’s Bond Market
Zambia’s bond market has performed strongly in February 2026, with foreign participation for a second consecutive month at 23 percent and total participation reaching 100 percent of auction allocations.
Auctions conducted by the Bank of Zambia were oversubscribed by over 100 percent, particularly in 5- to 10-year tenors.
The 10-year bond yield averaged 17.5 percent, inflation eased to 9.4 percent, and the policy rate was reduced from 14.25 percent to 13.5 percent, supporting fiscal discipline and price stability.
The government’s domestic debt ceiling of K300 billion in the medium term provides a framework for sustainable financing of infrastructure, public services and budget obligations.
Bonds are issued via competitive auctions and tradable in the secondary market, enhancing liquidity, price discovery and fiscal space.
Approximately 17 million Zambians benefit from easing inflation and reliable services, while businesses gain through improved credit transmission and investment planning.
Stakeholders must exercise caution: while the bond market delivers strong financing opportunities, frontier market risks including currency volatility, sovereign credit profile and liquidity constraints remain.
Careful management is critical to sustain confidence and long-term benefits.
