KWACHA POSTS GAINS AGAINST THE DOLLAR
Written by Millennium on June 13, 2019
BUSINESS REPORTER writes
The Zambian Kwacha was stable against the dollar on Monday due to hard currency inflows from corporates meeting their mid-month currency obligations and somewhat thin demand.
The Kwacha was bearish in early trade and touched an intraday low of K13.30/13.35 to the dollar by mid-day but reversed some losses by close of business to close at K13.26/31 on the bid and offer respectively.
According to Barclays Bank Zambia market update, in near term, the Kwacha is anticipated to trade in a narrow range.
On money market news, Barclays reported that liquidity levels in the market witnessed a slight drop to close at K1.275.81 billion from K1.306.02 billion the previous day.
The volumes of funds traded on the interbank also took a similar trend yesterday closing K23.8million short from the previous day at K552.70 million.
The cost of borrowing funds on the interbank increased to 10.20 percent from 10.30 percent.
The bank further reported that there was little activity on the market yesterday with settlement of the of auction held on June 6.
Oil prices fell more than 1percent on Monday as U.S.-China trade tensions continued to threaten demand for crude and as major producers Saudi Arabia and Russia had yet to agree on extending an output-cutting deal.
Brent crude futures fell $1, or 1.6 percent, to settle at $62.29 a barrel. U.S. West Texas Intermediate (WTI) crude lost 73 cents, or 1.4%, to end at $53.26 a barrel.
On gold, prices dropped more than 1 percent on Monday, slipping from a 14-month peak, after U.S. President Donald Trump’s decision not to impose trade tariffs on Mexico spurred risk sentiment and lifted the dollar from recent lows. Spot gold dipped 1.1% to $1,326.13 per ounce as of 1:38 p.m. EDT (1738 GMT).
The metal had hit $1,348.08 an ounce in the previous session, its highest since April last year. U.S. gold futures settled 1.2% lower at $1,329.3 per ounce.
The Mexico news boosted LME copper, which gained 1.3percent to $5,874 a tonne and seemed to shrug off data showing China’s May imports of the metal were down nearly 11opercent from the previous month.
Copper and some other industrial metals stabilised on the back of a U.S.-Mexico deal that averted new tariffs and raised hopes of an agreement with China.