The Bank of Zambia’s Monetary Policy Committee (MPC) cut the Monetary Policy Rate by 250 basis points to 10.75% in September 2026, aligning the stance with lower-than-previously indicated inflation outcomes and projections while supporting lower financing costs and economic growth. This followed cuts of 25 basis points to 14.25% in November 2025, 75 basis points to 13.5% in February 2026 and 25 basis points to 13.25% in May. Inflation fell to 6.1% in September, within the 6-8% target band, and is projected to average 6.7% in 2026 and 6.0% in 2027, supported by stable maize prices following a record harvest and the lagged impact of kwacha appreciation. The currency’s gains reflected higher mining export earnings and improved foreign exchange liquidity following the December 2025 Currency Directives. The MPC cited expected super El Niño conditions, the protracted Middle East conflict, potentially higher crude oil prices and tighter global financial conditions as upside risks. Future rate decisions will remain guided by inflation outcomes, forecasts and risks, including those related to financial stability.
Bank of Zambia Cuts Monetary Policy Rate by 250 Basis Points to 10.75%
The Bank of Zambia’s Monetary Policy Committee cut the Monetary Policy Rate by 250 basis points to 10.75% in September 2026, citing lower inflation and support for financing and growth. Inflation fell to 6.1%, within the 6% to 8% target band, while future decisions will reflect inflation and financial stability risks.