Assessing the Effectiveness of Inflation Control Measures: A Case Study of Financial Institutions in Lusaka

This study explores the effectiveness of inflation control measures in Zambia, focusing on monetary policy, fiscal policy, and exchange rate management. Data from Zanaco Bank, ABSA Bank, and the Ministry of Finance was analyzed using Excel and Stata. Key findings indicate that while the Bank of Zambia's monetary policies, such as interest rate adjustments and reserve requirements, have been moderately effective, challenges persist in liquidity management and inflation targeting. Fiscal policies, including government expenditure and tax management, showed limited impact due to fiscal imbalances and high public debt. Exchange rate management, particularly foreign exchange interventions, was minimally effective, though foreign exchange reserves management had a notable positive impact. The study recommends improved fiscal discipline, enhanced exchange rate policies, and better coordination between fiscal and monetary strategies to achieve sustained inflation control.