Editing Economy of Zambia (section)

==Inflation==
[[File:GDP per capita (current), % of world average, 1960-2012; Zimbabwe, South Africa, Botswana, Zambia, Mozambique.png|thumb|300px|left|GDP per capita (current), compared to neighbouring countries (world average = 100)]]

Lack of [[balance of payments|balance-of-payment]] support meant the Zambian government did not have resources for [[capital investment]] and periodically had to issue [[Bond (finance)|bonds]] or otherwise expand the money supply to try to meet its spending and debt obligations. The government continued these activities even after balance-of-payment support resumed. This has kept interest rates at levels that are too high for local business, fuelled [[inflation]], burdened the budget with domestic debt payments, while still falling short of meeting the public payroll and other needs, such as [[infrastructure]] rehabilitation. The government was forced to draw down [[foreign exchange reserves]] sharply in 1998 to meet foreign debt obligations, putting further pressure on the [[Zambian kwacha|kwacha]] and inflation. Inflation held at 32% in 2000; consequently, the kwacha lost the same value against the [[dollar]] over the same period. In mid- to late 2001, Zambia's fiscal management became more conservative. As a result, 2001 year-end inflation was below 20%, its best result in decades. In 2002 inflation rose to 26.7%. However, in 2007 inflation hit 8%, the first time in 30 years that Zambia had seen single digit inflation.

On January 27, 2011, it was reported by the Central Statistical Office that inflation rose to 9%.<ref>{{Citation |title=Zambia Annual Inflation Accelerates to 9% in December, State Agency Says |url=https://www.bloomberg.com/news/2011-01-27/zambia-annual-inflation-accelerates-to-9-in-december-update1-.html |year=2011 |publication-place=[[Bloomberg L.P.]] |publisher=bloomberg.com}}</ref> in 2012

Between April  2019 and April 2020 Zambia' s Annual inflation rate rose to 15.7% from 14% in March 2020. The rise  of prices in food and other non- food items led to the increase in the Annual inflation rate.<ref name=":6">{{Cite web |last=Zambia Statistics Agency |date=30 April 2020 |title=The Monthly Bulletin |url=https://www.zamstats.gov.zm/phocadownload/Monthly/2020/Vol%20205%202020%20The%20Monthly%20April.pdf#page=3 |access-date=26 May 2020 |website=zamstats.gov.zm |archive-date=30 July 2020 |archive-url=https://web.archive.org/web/20200730234631/https://www.zamstats.gov.zm/phocadownload/Monthly/2020/Vol%20205%202020%20The%20Monthly%20April.pdf#page=3 |url-status=dead }}</ref>

However, it is significant that inflation often peaks in election years, hitting a recent high of 17.9% in 2016. This  suggests  that  a  further  peak  is  likely  approaching  during  the  2021  general  elections. The value of the kwacha against the dollar has been relatively consistent for the past two years and has yet to return to the recent high of almost 0.2 kwacha to the dollar in 2013. Nonetheless, the real effective exchange rate of the kwacha against a weighted average of foreign currencies improved from 88.5 in 2016 to 96.4 in 2017. The kwacha lost value against the dollar in September 2018 but has remained fairly consistent at 0.08 to the dollar in November to December, though further instability remains likely due to both political and economic uncertainty.<ref name="CR" />