Copper rally boosts Zambia’s kwacha

Zambia’s kwacha rose, joining a rally in the currencies of other African metal producers, as a surge in the price of copper promises to boost export earnings.

The kwacha rose 0.6% against the dollar on Monday, its strongest level against the dollar since early November, after copper barreled toward a record $13 000 a ton in London on concern that global supplies will dwindle as US companies step up imports ahead of potential tariff increases.

Read: China’s Jiangxi to buy copper miner SolGold in $1bn deal

Zambia is Africa’s second largest copper producer, after the Democratic Republic of Congo, which has also seen its local currency, the franc, strengthen. The currencies of Ghana, the continent’s largest gold producer, and South Africa have also been gaining on higher metal prices.

In general, Africa’s commodity producers stand to benefit from the jump in gold and other precious metals, according to Brendan McKenna, an emerging-markets economist and foreign-exchange strategist at Wells Fargo Securities.

“South Africa is still very much an economy that is influenced by mining activity and the price of precious metals,” said McKenna.

“So another rally for gold in 2026 could be supportive of rand, especially while the Federal Reserve is cutting in the early parts of next year.”

Read: Rand set for biggest gain in 16 years on SA stability

The kwacha closely tracks copper prices, which have jumped by more than a third this year. That’s pushed up Zambia’s kwacha 24% against the dollar.

On Friday, in an effort to support wider use of the kwacha, the Bank of Zambia also ordered that all domestic transactions be settled in the local currency instead of dollars, according to a government gazette. It provided exemptions for mining companies that will continue paying taxes in dollars.

© 2025 Bloomberg

Follow Moneyweb’s in-depth finance and business news on WhatsApp here.