The Standard Chartered Bank has indicated that the Kwacha was expected to be range bound this week between K5.430 and K5.530 against the United States dollars for bid and offer respectively.
And the Zambia National Commercial Bank (ZANACO) has observed that the US dollar was likely to test the Kwacha’s resilience in the short term with an expected trading range of between K5.45 and K5.50.
Standard Chartered bank has however stated that the Kwacha was likely to show some marginal gains ahead of this week’s corporate tax payment deadline.
In its daily brief for July 08, 2013, Standard Chartered disclosed that the Kwacha last week closed around K5.4700 and K5.510 levels.
“The local unit was backed by stable flows and traded at almost similar levels to a dollar like Thursday’s trading,” the bank said.
Meanwhile, ZANACO stated that the local unit was expected to show resilience against the greenback and trade between K5.45 and K5.50 for bid and offer.
According to the banks daily treasury newsletter, the Kwacha remained largely unchanged against a broadly bullish dollar on Friday with little activity in the local markets to provide clear direction.
“The local currency opened and closed trading at K5.480 and K5.500 for a third day running and to also close a short week of trading unchanged. Intra-day, the Kwacha showed some resilience peaking at K5.475 and 5.495 although selling activity was insufficient to cement the gain,” the newsletter read in part.
ZANACO maintains that the domestic unit was steadfast despite a strengthening of the dollar to a three-year high against a basket of major currencies in global markets.
On the international money market, South Africa’s rand and government bonds weakened on Friday, falling more than 1.6 percent to 10.19 against the greenback from Thursday’s close at 10.0260 as investors dumped emerging market assets.
This was after U.S jobs numbers came in better than expected which supported views that the Federal Reserve will scale back its asset purchasing programme.
The British Sterling pound slid to a near four-month low on Friday against the dollar, which was boosted when stronger than expected U.S. employment data fed expectations of the Federal Reserve paring back its stimulus.
The pound was down more than one percent at $1.4890, having fallen to $1.4855, its lowest since March 12 this year.
And the euro hit a five-week low against a broadly stronger dollar on Wednesday after rising political tension in Portugal pushed up the borrowing costs of peripheral euro zone countries.
The euro fell 0.3 percent to $1.2923, its lowest since late May.