Kwacha continues to gain strength against the dollar
Written by Millennium on July 9, 2019
BUUMBA CHIMBULU writes
THE Kwacha has continued to strengthen against the dollar due to corporates converting for tax obligations amid reduced dollar demand from the energy sector and merchandise importers.
As at 08:30hours, commercial banks quoted the Kwacha at K12.800/12.850 per dollar, unchanged from Thursday’s close.
According to Barclays bank Zambia daily market update the local unit gained gradually on the day to close seven ngwee stronger at K12.725/12.775 on the bid and offer respectively.
The Kwacha, said the bank, was likely to trade bullish in the near term on the back of healthy dollar inflows.
And the Zambia Industrial Commercial Bank said the Kwacha posted further gains against the greenback on Tuesday and was buoyed by increased supply.
“The local unit touched a multi-session high of 12.900/12.950 last seen in the previous week. The currency pair is likely to receive additional support from month-end conversions.
“The Kwacha closed at 12.925/12.975, K0.1 stronger than its opening levels and remains in positive territory compared to a basket of currencies which have generally weakened against the world’s reserve currency,” said the bank.
Elsewhere, South Africa’s rand was little changed against the dollar early on Friday, as investors braced for U.S. employment data, a key release that could stoke or temper market expectations about aggressive policy easing by the U.S. Federal Reserve.
The rand traded at 14.0550 per dollar, not far off its New York close of 14.0500 on Thursday.