Business

Kwacha expected to come under pressure against greenback

TRYNESS TEMBO, Lusaka
THE Kwacha is expected to come under pressure against  the United States (US) dollar as demand increases in the next few weeks, Finance Bank Zambia observes.
In its daily market update, the bank says the local unit opened the year trading at K10.98 and K11.00.
Finance Bank Zambia says the Kwacha traded at K10.99 and K11.01 on the interbank on Monday and witnessed a day’s low of K11.01 and K11.03 where it closed.
“As was the case at the close of 2015 Kwacha remains stable at the start of 2016,” the statement reads.
Similarly, Zanaco says the trading range for the Kwacha is expected to be between K10.950 and K11.150 in the short term.
The bank says the local unit was steady on Monday and is expected to maintain a narrow range in the coming days, with activity likely to only pick up in early next week when businesses fully reopen after the festive break.
“Opening the day unchanged from Thursday’s close of K10.99 and K11.01, the local currency traded flat on the day to close at its opening level for a consecutive day,” the bank says in its daily treasury newsletter.
Cavmont Bank in its market report also says on Monday, the Kwacha opened the year trading above the K11.00 per dollar mark with minimal activity being seen from most corporates who are still on industrial break.
The bank says currency pair opened trading at K11.00 and K11.02 on interbank and was generally unchanged throughout the trading session.
It says the market closed at K11.01 and K11.03 which was K0.01 weaker from last Thursday’s closing levels.
On the regional front, the South African rand appreciated to 15.528 on Tuesday from 15.554 on Monday ,Kenyan shilling to 102.299 from 103.075 , the Botswana pula to 11.329 from 11.334 while Ugandan shilling remained unchanged at 3,400.
On the commodity maket,copper hit a two-week low on the first trading day of 2016 after weak Chinese factory data weighed heavily on Shanghai equities and rekindled worries over demand in the world’s largest metals consumer.
Three-month copper on the London Metal Exchange was last bid down 1.5 percent at US$4,635 a tonne.

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