The Malawian kwacha continued to depreciate against major trading currencies despite an increase in gross official foreign exchange reserves in the month of October.
According to the October Monthly Economic Review, the gross official foreign exchange reserves improved to $624.6 million dollars in October as compared to $533.4 million in September.
This is mainly because of funds the country received from the International Monetary Fund (IMF) to address spending needs enhanced by Covid-19.
The statement reads in part: “The increase in reserves in October reflected receipt of the second disbursement by the IMF under Rapid Credit Facility.”
Despite having good inflow of foreign exchange, the Malawi Kwacha continued to depreciate against the major trading currencies as was the case in the previous month.
Here is an overview of three of those: against the American Dollar, the kwacha lost 0.3 percent and traded at K759.47 against 1 dollar at end October, going to show the scarcity of foreign exchange against demand.
Meanwhile, against the British pound the kwacha depreciated by 1.5 percent and traded at K1015.11 per pound and this was due to strengthening of some trade agreement that had earlier weakened the pound.
Last but not least in the Southern African Development Community (SADC) region the kwacha depreciated bay 3.9 percent against the South African Rand trading at K49.18.