Tax obligations anticipated to benefit Kwacha

MONTHEND tax obligations by corporates are expected to rescue the Kwacha that has been trading on the downward trend the past days, a financial market analyst says.
Zanaco Bank says the Kwacha is anticipated to recoup its losses in the short term as corporates offload United States dollars to meet monthly tax payments to Zambia Revenue Authority.
“Today [yesterday], trading is expected to be capped between K10.94 and K11.14 with a bullish bias as corporates convert their foreign currency to settle monthend salary obligations,” the bank says in its daily newsletter.
On Tuesday, the Kwacha held firm both in the morning and afternoon session, helped by tight local currency liquidity and weak demand for dollars from corporates.
At 08:30 hours, the local unit was trading at K10.98 and K11.03, 1.5 ngwee stronger than Monday’s close of K10.99 and K11.04.
“Matched demand and supply for the greenback from corporates and tight market liquidity helped the Kwacha trade flat on the day to see it close at its opening levels,” the bank says.
On the regional front, the South African rand yesterday strengthened trading around 14.69 levels against the dollar, according to FxWirePro.
The Nigerian naira, however, recorded a marginal depreciation, trading at N283.5 from N282.5, according to

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