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Tuesday’s trading session saw Zambia’s currency, the kwacha, maintain stability against the United States (US) dollar, driven by a balanced supply and demand for the greenback.
Opening at K26.6000/26.6500 on the interbank bid-offer rates, the kwacha held firm throughout the day, supported by adequate dollar inflows to match outflows.
In its daily market update, Absa Bank Zambia noted that supply and demand dynamics suggest the kwacha may hold a steady range in the near term as market forces remain relatively balanced.
The bank’s analysts highlighted that such stability could continue if current conditions persist, with no immediate pressure anticipated on the kwacha from either the demand or supply side.
On Monday, however, the kwacha faced some pressure as demand for the dollar increased slightly.
The currency began the trading day at K26.5500/26.6000 before slipping to close at K26.6000/26.6500.
This minor depreciation reflected a temporary uptick in demand for the dollar, which was met on Tuesday with sufficient supply to offset further weakening.
“Near-term movements for the kwacha-dollar pair will largely depend on the market’s supply and demand levels,” read the Absa update.
In regional markets, the South African rand traded slightly lower on Monday, quoted at 17.7075 against the US dollar.
Investors are closely watching for Wednesday’s mid-term budget review, the first under South Africa’s coalition government formed in June, which could signal potential fiscal changes affecting the currency’s outlook.
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