://www.daily-mail.co.zm” class=”f”>Zambia Daily Mail by Online Editor on 6/13/13
By TRYNESS MBALE
THE Kwacha is expected to be weak in the near term due to demand from importers out-weighing the supply of the United States dollar, Zanaco says.
Meanwhile, copper on the London Metal Exchange completed its first round of rebound and is expected to drop to US$7,020 per tonne.
According to Zanaco’s daily treasury newsletter, the local unit is likely to remain range bound to trade within the KR5.35 (K5,350) and KR5.45 (K5,450) boundaries.
“A weak Kwacha is expected in the near term as demand from importers out-weighs the supply of the greenback,” the statement reads.
On Wednesday, the Kwacha opened trading KR0.05 down at KR541 (K5,415) and KR5.43 (K5, 435) from the previous day close of KR541 (K5,410) and KR5.43 (K5,430).
The bank says the domestic currency pared its losses in volatile early morning trading as interbank-driven supply as well as corporates pumped dollars into the market boosting the Kwacha to a high of KR5.39 (K5,390) and KR5.41 (K5,410).
The Kwacha failed to hold on to its gains to close trading day at its opening levels of KR5.41 (K5,415) and KR5.43 (K5,435), trading flat for the day.
Similarly, Standard Chartered Bank daily news brief says the Kwacha was unchanged after Wednesday’s trading and continued to trade above KR5.4 (K5,400) against the dollar
The bank says although the exchange market saw considerable amount of dollar flows, the supply side fell short against the increased demand.
“The dollar against the Kwacha exchange was largely unchanged after Wednesday’s trading. Kwacha continued trading throughout the session above the KR5.4 (K5,400) psychological [level] against the dollar,” the statement reads.
On copper, the downward trend in the copper price is likely to impact on the Kwacha direction in the medium to long-term, Barclays Bank in its market update.