FINANCE Bank anticipates that reduced Kwacha liquidity in the market is expected to stabilise the local currency in the short term.
In its daily market update, the bank says the local unit was relatively stable on Friday as intra-day movements could only be found in the K7.30 and K7.40 band.
The Kwacha opened trading on a strong note at K7.31 and K7.33, and went on to hit an intra-day low of K7.37 and K7.39, closing later at K7.33 and K7.35.
“Reduced Kwacha liquidity remains the main stabilising factor in the short-term,” the statement reads.
Similarly, Zanaco Bank says the Kwacha is expected to continue trading in a narrow range with a bias to gain, as reduced local currency liquidity and dollar inflows into next Thursday’s treasury bill auction from investors abroad.
The local unit is anticipated to trade in the range of K7.30 and K7.40 in the near-term.
On Friday, the local unit was largely stable against the dollar with little activity witnessed on the day.
The bank says thin flows from corporate and interbank players witnessed the local unit hold steady against the dollar from an opening of K7.35 and K7.37 to reach highs of K7.34 and K7.36 on the bid and offer respectively where it closed off for the day.
Meanwhile, Cavmont Bank, in its market report, says despite the steady rise in copper prices, the local unit has failed to move in tandem owing to mismatch in demand and supply.
The Kwacha closed trading at K7.34 and K7.36 rebounding positively by 0.41 percentage points on Friday.
On Friday, the local unit opened trading at K7.35 and K7.37 and depreciated marginally by 0.27 percentage point against the dollar in early trade at K7.37 and K 7.39.
It, however, says improved corporate inflows helped the Kwacha to recover and witnessed it touch K7.33 and K7.35 for bid and offer respectively.
This is a win on paper only. In the meantime, the economy is suffering. Citizens have stopped buying anything other than essentials. Zambia is now a dry shell.
BOZ should find out how the mines are manipulating the kwacha. The mines are responsible for this mess.