Zambia’s Inflation Dips Below 8%, Makes 1.9% Drop Margin

Zambia’s annual inflation rate has substantially declined from 9.4% in January to 7.5% in February, marking a sharp 1.9 percentage point drop within one month.

This development signals easing price pressures and improving macroeconomic stability.

The decline is largely driven by improved food supply conditions, given that food carries the largest weight in the consumer basket.

Furthermore, it is very important to see that any moderation in mealie meal, grains and fresh produce has a strong impact on overall inflation.

Exchange rate stability has also supported the trend, as a firm Kwacha reduces the cost of imported goods.

The policy stance of the Bank of Zambia continues to anchor inflation expectations through tight monetary management.

However, monetary policy works with a lag, suggesting that food dynamics and exchange rate movements were the primary short-term drivers.

While this decline is encouraging, and sustaining it will only depend on the continued currency stability, agricultural productivity and fiscal discipline in the months ahead.