Business

Kwacha expected to gain against US dollar

TRYNESS TEMBO, Lusaka
THIS week, the Kwacha is expected to gain against the United States (US) dollar as the market is expected to witness increased inflows from corporates who will be paying their month-end tax obligations, financial market players’ note.
Zanaco estimates the local unit trading range of K10.10 and K10.20 range.
“The Kwacha is forecast to trade with a bearish tone over the coming sessions as dollar supply remains thin while local currency liquidity is likely to rise due to public and corporate wage demands,” Zanaco notes in its daily treasury newsletter on Friday.
However, the Kwacha lost more ground in jittery trading on Thursday triggered by increasing demand for the greenback in local markets.
The local unit, which opened for trading at K9.975/K10.025, immediately showed weakness sliding to 10.01/10.060.
“Steady interest in the greenback led the Kwacha to eventually close at the day’s low of 10.05/K10.10. It was two and a half ngwee weaker on the day and down for a third consecutive day,” the bank notes.
Similarly, First National Bank (FNB) says that on Thursday, the Kwacha did not move from its opening level, trading at a range of K10.00 and K10.10 throughout the day due to a balance between the demand and supply of the greenback in the market.
The bank says with no major events locally, the dollar/Kwacha is once again expected to trade within the current range.
“Nonetheless, next week, with month-end approaching, we expect to see an increase in dollar sellers on the market which should see the local unit gain momentum,” the bank says in its daily newsletter.
Cavmont Bank in its market report also says recent trends seem to suggest that the local currency is likely to continue oscillating between gains and losses, with its performance being determined by the factors of demand and supply.
The bank says the Kwacha came under slight pressure against the dollar on Thursday following increased demand on interbank as well as from corporate buyers.
On the regional front, the Kenyan shilling firmed slightly on Friday, drawing support from dollar inflows from non-governmental organisations and offshore investors to trade at 101.05 and 101.15 to the dollar and South Africa’s rand traded firmer early on the day to trade at 13.6000.
Meanwhile the Botswana pula, Nigerian naira and Ghanaian cedi remained unchanged at 10.39,304 and 3.99 respectively.

Facebook Feed

ePaper App

Follow Us on Twitter