THE Bank of Zambia has indicated that increase in fuel pump prices and electricity tariffs are necessary to restore fiscal sustainability, as it adjusts the cost of money upwards to nine percent.
The central bank has therefore warned that non reforming of the energy and agriculture sectors will continue putting pressure on the treasury, thereby elevating the inflation rate.
“The reforms we are talking about are extremely important,” says BoZ governor Denny Kalyalya.
Dr. Kalyalya however mentioned that this posed a risks to the inflation outlook.
He said this yesterday in Lusaka when announcing the policy rate for the fourth quarter of this year.