Zambian Kwacha Strengthens as Central Bank Interventions Drive Gains
The Zambian Kwacha has shown signs of improvement in recent trading sessions, buoyed by interventions from the Central Bank aimed at stabilizing the currency.
Following the injection of $50.3 million by the Bank of Zambia into the market on February 6th, 2024, to mitigate further depreciation, the Kwacha has seen notable gains against the United States dollar.
According to the ABSA Bank Daily Report, Monday’s trading session witnessed a positive trend, with corporate demand dropping significantly as the Central Bank continued to support the market.
The local unit opened at K26.925 and K26.975 on the bid and offer respectively, before appreciating to K26.900 and K26.950. The day concluded with the Kwacha trading at K26.825 and K26.875 on the bid and offer respectively.
Analysts suggest that in the near term, the performance of the Zambian currency will be influenced by the interplay of demand and supply dynamics.
Access Bank also reported an appreciation of the Kwacha against the US dollar, noting a rally in Monday’s trading session. The currency was quoted at K26.850 against the US dollar, marking a 0.82% increase from its previous close.
Further reinforcing the positive sentiment, Access Bank disclosed that the Central Bank offloaded an additional $70 million into the market on Monday, February 13th, 2024.
This move aimed to address the accumulated long-term demand for hard currency, thereby stimulating market activity and contributing to the appreciation of the local currency.
In response to these developments, market analysts anticipate continued gains for the Kwacha in the near term, underpinned by the supportive interventions from the Central Bank and improved market sentiment.
Additional source: ZANIS
