The Bank of Zambia has recently implemented restrictions on the circulation of money by increasing the statutory reserve ratio. This applies to both local and foreign currency deposits, as well as government and Vostro account deposits. The reserve ratio has been raised by 3% percentage points, bringing it to 14.5% from the previous rate of 11.5%.
According to the circular, the revised statutory reserve ratio of 14.5 percent will be calculated based on the weekly return of selected assets and liabilities as of Wednesday, November 8, 2023.
The implementation of restrictions on money circulation by the Bank of Zambia (BOZ) is intended to address the ongoing pressure in the foreign exchange market and control inflation, according to Dr. Chipimo.
The bank will closely monitor macroeconomic developments and the financial market, and will take necessary actions as needed to achieve its objectives.
