Kwacha Trading in Fragile Equilibrium

The Zambian kwacha weakened for a second consecutive session, closing above K23.300/$, amid strong corporate demand for foreign currency.

Trading is expected to remain consolidative this week, with limited volatility due to subdued market activity.

While short-term stability may hold, the kwacha remains vulnerable to delays in mining inflows, persistent dollar demand and global dollar strength, with projected trading ranges of K23.200–23.500/$.

The tax season in August, combined with low dollar inflows from mining and agriculture, is exerting additional pressure on the currency.

Medium-term stability will depend on timely FX inflows, BOZ interventions and external market conditions.