Story of the Day
An Executive Summary of the IMF- FISCAL MONITOR (Helping People Bounce Back) OCT 2022
Rising inflation and climbing interest rates have supplanted more than a decade of muted inflation and low interest rates in many countries. Recession concerns are surfacing and geopolitical tensions have increased further as Russia’s invasion of Ukraine persists (October 2022 World Economic Outlook). Fiscal policy trade-offs are increasingly difficult, especially for high-debt countries where responses to the COVID-19 pandemic exhausted their fiscal space. Households are struggling with elevated food and energy prices, raising the risk of social unrest. Read more
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President Hakainde Hichilema has called for assistance from the African Development Bank (AfDB) in creating a platform for Zambia to address its debt restructuring process. President Hichilema says the AfDB can help Zambia mobilise resources through networking with the bank’s relations. Speaking when a team from AfDB called on him at State House, President Hichilema said Zambia requires interventions in various areas that fit in the country’s agenda, and the financial sector is one of them. And President Hichilema noted the need for Africa to turn around its economic status, in order for the continent to take its place at global level. Read more: ZNBC
The Ministry of Local Government and Rural Development has launched a mobile phone platform for citizens to access information on Constituency Development Fund (CDF). The platform will be accessed by dialing a code and will bring information in various languages. The CDF information and learning platform has been developed by Alliance for Accountability Advocates Zambia (AAAZ) and Viamo. Accountability Advocates Zambia Executive Director Luchembe Chilufya said the platform is meant to spread information on the different CDF programmes. Read more: ZNBC
President Hakainde Hichilema has said Zambia’s ambitious target to increase copper production from the current 830,000 metric tonnes to 3,000,000 in the next ten years is attainable. In a speech read for him by Mines and Minerals Development Minister Paul Kabuswe during the opening of the 10th Zambia International Mining, Energy Conference and Exhibition (ZIMEC) at Garden Court Hotel in Kitwe on Tuesday morning, President Hichilema said Government is committed to meeting the ambitious yet achievable target. Read more: Lusaka Times
Standard Chartered Bank says the stability of the kwacha and inflation rate has placed Zambia in a firm position to have a positive economic outlook for 2023. The Bank has however cautioned the Central Bank to take the necessary measures to handle any risks that may come from external shocks. Standard Chartered Bank said the Bank of Zambia needs to take precautionary steps, in the wake of investors exploring other markets. Read more: Lusaka Times
International Business and Finance
In an historic milestone, the Bank of England has begun to unwind the key emergency support it brought in after the 2008 financial crisis. The bank sold off a tranche of government bonds on Tuesday, as it started to reverse the process known as “quantitative easing” or QE. QE has been credited with helping the UK through shocks such as Covid. But it has also been blamed for bringing in an era of “cheap money” which benefited some but not others. The Bank began QE in March 2009, to prop up the UK economy after banks stopped lending to each other and the country fell into a deep recession. Read more: BBC News
Good news for Nigerian business conglomerate Dangote as his business continues to flourish. Despite the rising inflation and interest rate for Q3 of 2022 in Nigeria, Dangote Cement experienced an increase in the volume of cement it sold by 6.2 per cent, recording 20.8 metric tons of sales. The CEO of Dangote Cement, Michel Puchercos made the announcement during the weekend while presenting the third quarter results to the Nigerian Stock Exchange. He also mentioned that using alternative fuel sources has shown significant promise in cutting down production costs. Read more: Business Insider
Amazon has exited the trillion-dollar club. Shares of the e-retailer plunged 5.9% on Tuesday, falling for a fifth straight day and closing at their lowest since April 2020. The sell-off has erased almost all of the stock’s pandemic surge. Investors continued to punish the company for last week’s disappointing fourth-quarter forecast. Amazon said revenue during the holiday quarter would grow 2% to 8% over the year-ago period, far below analysts’ estimates. Read more: CNBC
The market expects the Bank of England to raise interest rates by 75 basis points on Thursday, its largest hike since 1989, but economists believe policymakers will strike a dovish tone looking ahead as the prospect of a recession deepens. With U.K. inflation running at a 40-year high of 10.1% in September, the Bank is seen hiking its main lending rate for the eighth consecutive time, but weaker growth momentum and a major shift in fiscal policy is expected to ease calls for more aggressive monetary tightening. Goldman Sachs economists on Monday lowered their 2023 U.K. growth projections from an annual rate of -1% to -1.4%, citing what is likely to be a less generous household and business energy cost assistance scheme under Sunak. Read more: CNBC
Capital Markets Report
In 99 trades recorded yesterday, 30,803 shares were transacted resulting in a turnover of K119,773.69. A share price gain of K0.01 was recorded in Zanaco. Trading activity was also recorded in AECI, Airtel, Copperbelt Energy Corporation Zambia, Chilanga Cement, PUMA, Standard Chartered Bank Limited, Zambeef and Zambia Sugar as well as CEC Africa on the quoted tier. The LuSE All Share Index (LASI) closed at 7,233.54 points, 0.05 points up from it’s previous close of 7,230.22. The market closed on a capitalization of K72,417,985,445.77 including Shoprite Holdings and K37,635,300,005.77 excluding Shoprite Holdings.
