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May 27 this year marked exactly one year since the Reserve Bank of Malawi (RBM) devalued the kwacha by 25 percent in a move RBM Governor Wilson Banda justified as a necessary evil to align the foreign exchange supply to the macroeconomic fundamentals. Defined as a deliberate downward adjustment in the value of a country’s
Data from the Reserve Bank of Malawi (RBM) shows that commercial banks extended K2.5 trillion credit to the Malawi Government during the first quarter (Q1) of this year. Government dominance in borrowing from commercial banks has come under spotlight with analysts arguing the development is detrimental to meaningful investment. The Q1 Financial Economic Review Report
The African Development Bank (AfDB) has decried the Malawi Government’s preference for short-term debt securities with relatively high interest rates, saying this is worsening the country’s debt vulnerability. In its 2023 Africa Economic Outlook, the pan-African bank said the domestic bond market is characterised by short-term securities with interest rates averaging 20 percent, attracting high
One year after the Reserve Bank of Malawi (RBM) devalued the kwacha by 25 percent, misalignments in the foreign exchange market still prevail with figures showing a 49.61 percent spread between bank rates and the official rate. The kwacha is trading at an average of K1 550 in authorised dealer banks (ADBs) against K1 036,
Market watchers and local businesses say despite the weakening of the rand presenting an opportunity for local businesses, the real impact would depend on various actors, including potential inflation in South Africa.The rand fell against the dollar and other currencies last week on investor concerns over the worst power cuts. Another concern was the