THE Kwacha is expected to hold firm against the United States (US) dollar in the near-term due to greenback inflows, financial players say.
Zanaco Bank says the currency on Friday was anticipated to trade in the range of K9.85 and K9.95.
“The Kwacha is likely to hold firm against the dollar in the near-term. The Kwacha gained against the greenback on Thursday for a consecutive day as central bank actions in the currency markets continued to support the local currency,” the bank says in its daily treasury newsletter.
On Thursday, the Kwacha opened trading at K9.92 and K9.94 per dollar, unchanged from Wednesday’s close, and touched an intraday high of K9.84 and K9.86 due to an interbank sell-off and continuous support from the central bank.
The bank, however, says the Kwacha failed to hold on to all its gains and closed the day one ngwee down.
In its daily market report Citi Bank says dollar inflows between Wednesday and Thursday provided some support for the Kwacha.
On Thursday the Kwacha opened trading at K9.92 and closed at K9.855 supported by inflows from the Bank of Zambia (BoZ) , as well as exporter conversion for tax obligation due today.
It says the Kwacha was expected to trade in the range of K9.69 and K9.90.
First National Bank (FNB) also says the BoZ’s presence in the market last week provided much-needed support not just by selling dollars, but by giving players the confidence that they are willing to act.
In its market update, FNB says the presence of BoZ in the market resulted in the Kwacha trading below the K10 mark and touching a low of K9.60.
“The panic-buying that was witnessed when the [Kwacha] unit hit the K10 level has subsided,” the statement reads.
On the regional front, the Kenyan shilling depreciated to 105.255 on Thursday, from 105.655 on Friday, while the Botswana pula and South African rand appreciated to 10.436 from 10.544 and 13.551from 13.629, respectively.
Other currencies which appreciated were Nigerian naira to 198.95 from 199.05, according to usd.fxexchangerate.com.\