MARKET experts have predicted a much weaker currency this week as the kwacha continued on a depreciating path in last week’s trading. Friday saw the local currency trading at above K11.60, with Cavmont Bank saying the next resistance level is expected at K11.70.
“…Market activity was mostly on the interbank, though most players were protective of their offer side. Corporate activity was still flat as most players remained cautious and optimistic. Current trends suggest that the next resistance level for local unit is likely to be around $/K11.700,” stated Cavmont in its Friday market update.
Demand for the US dollar continued against minimal supply, according to FNB Zambia.
“The kwacha ends the week on a sour note as the dollar remains king against the kwacha. Demand for the greenback continues to intensify and lead the market while the supply side remains unfilled. Corporate FX (foreign exchange) players’ appetite for dollars has played a major contribution to its demand while many sellers have held back as they anticipate a much higher level in a quest to maximise kwacha returns,” stated FNB Zambia.
“The market yesterday closed at 11.525/11.575 where it is expected to open this morning. With no supply, a bearish kwacha is expected during Friday’s trading session. The central bank is still very active in the market via OMO. Amounts accepted were up to ZMW1.3bn at a weighted average rate of 9.74% on Thursday.”