Kwacha gains against dollar
Written by Millennium on June 5, 2019
BUSINESS REPORTER writes
THE Zambian Kwacha gained against the dollar on Friday on the back of corporates winding up on their month end local currency obligations, decent supply from the mining houses and tight local money market liquidity.
The Kwacha gained gradually in both the morning and afternoon trading sessions to close at K13.15/13.20 per dollar compared to Thursday’s close of K13.45/13.50.
According to Barclays Bank Zambia market update, the local unit was likely to trade range bound in the near term.
On money market, the bank reported that : liquidity level slightly decreased on Friday to close at K794.92 from K864.33 Million the previous day.
The volume of funds traded on the interbank also marginally decreased to K422.30 Million from K449.50 Million. The cost of borrowing funds on the interbank was unchanged at 10.18%.
It reported that local markets were little changed on Friday in fixed income with the yields remaining relatively unmoved.
Oil pice slumped over 3% on Friday and posted its biggest monthly drop in six months, after U.S. President Donald Trump stoked global trade tensions by threatening tariffs on Mexico, a key U.S. trade partner and major supplier of crude oil.
Brent crude futures fell $2.38, or 3.6%, to settle at $64.49 a barrel.
A Reuters survey showed Brent crude prices are likely to hold near $70 a barrel for the rest of the year as elevated supply risks in the Middle East offset risks to demand.
Gold climbed to a seven-week peak on Friday and was headed for its first monthly gain in four months, as investors sought the safe haven investment after President Trump threatened tariffs on imports from Mexico, which fed fears of a global downturn.
Spot gold jumped 1.3% to $1,305.17 an ounce by 1:51 p.m. ET (1751 GMT), having hit its highest since April 11 at $1,306.64. U.S. gold futures settled up 1.9% at $1,311.1.
The bank further reported that London copper eased on Friday and was on track for a third straight and biggest monthly fall in three-and-a-half years as global trade tensions raised concerns on weaker demand.
Benchmark copper on the London Metal Exchange (LME) fell 0.2% to $5,839.50 a tonne at 0748 GMT, and was down 9% for the month of May, the strongest monthly decline since November 2015.
The metal has fallen 10.3% in the past three months.
