Importers chase after dollar – Zanaco



THE Kwacha is expected to continue trading on a weak foot against the United States dollar as demand for the greenback by importers is anticipated to pick up as the month progresses.
According to Zanaco’s daily treasury newsletter, the local unit is likely to float in the KR5.3 (K5,300) and KR5.34 (K5,340) range.
On Wednesday, the Kwacha struggled against the dollar as demand for the greenback outweighed supply.
The bank says the local unit resumed trading on Tuesday’s close of KR5.34 (K5,340) and KR5.36 (K5,360) on the bid and offer, respectively.
“The Kwacha adhered closely to its opening levels through the trading session but slipped briefly to touch a two-week low [of] KR5.34 (K5,345) and KR5.36 (K5,365) against the dollar,” the statement reads.
The bank says the domestic unit pared its losses, supported by corporate inflows to close the day at its opening levels.
Similarly, Standard Chartered Bank says the Kwacha on Wednesday traded in the same levels as Tuesday’s session.
“Yesterday [Wednesday], we saw dollar trade against the Kwacha at similar levels as Tuesday’s session. There was a keen interest from the dollar supply side corporates in the market,” the statement reads.
The bank says the Kwacha closed around KR5.32 (K5,325) and KR5.37 (K5,375).
Meanwhile, Citibank daily market commentary says the Kwacha on Wednesday traded in a stable range of KR5.33 (K5,335) and KR5.35 (K5,355) on the interbank market.
The bank says: “We expect growing demand for dollars for the rest of the month as market players’ local currency liquidity positions improve.”
It says the Kwacha has also been helped by an improved outlook on copper prices.
On Wednesday, copper touched US$7,500 a tonne, recovering from a dip in late April to 18-month low below US$6,800 a tonne due to seasonal demand from China and supply disruptions, but prices are still down more than six percent for the year.