Asymmetric Exchange Rate Pass-Through to Private Credit in Zambia: A Nonlinear ARDL Analysis

Abstract

<jats:p>Exchange-rate movements constitute an important channel of monetary transmission in commodity-exporting emerging economies, where foreign-currency liabilities, concentrated export structures and relatively shallow financial markets amplify their effects on private-sector credit. Existing work on Zambia relies primarily on symmetric linear models that impose identical responses to exchange-rate depreciations and appreciations, an assumption that may obscure important nonlinear adjustment. This study evaluates that assumption using a nonlinear autoregressive distributed lag (NARDL) model estimated with 55 quarterly observations covering 2012Q2–2025Q4.</jats:p>