• The Kwacha will continue to trade on a depreciating trend but moderately so.
• The Kwacha will not depreciate as much as at the start of the year.
• Because of the elections frenzy, there might be some disruptions in businesses.
A Commercial Bank says the Kwacha is this month expected to continue trading on a depreciation trend but moderately due to the continued improvement in economic activities.
Speaking in an interview with Money FM News, Zanaco Economist Chewe Mwila said the local unit will see minimal losses as it will not depreciate as much as it did at the start of the year.
Ms. Mwila stated that country now expects more Foreign Exchange supply, a move that is likely to improve the Kwacha positions.
She also noted that as a result of high Copper Prices on the international market, the bank does not expect the local currency to continue depreciating at a faster rate.
“We are expecting that with the positive sentiments and the continued improvement in economic activities, the Kwacha will continue to trade on a depreciating trend but moderately so. The Kwacha losses are going to be minimized.”
“The Kwacha will not depreciate as much as we had seen at the start of the year because now we expect more FX supply which is likely to improve the Kwacha positions. So if FX supply will be significant we might see a trend reversal, we might see the Kwacha start appreciating.”
“We have also seen Copper prices, even though last week the prices fell below 10, 000 dollars per metric tonne, they are still very high so we expect more FX inflows, and because of that, the Kwacha is expected to trade on a depreciation trend but moderately so, we do not expect the Kwacha to continue depreciating at a faster rate,” Ms. Mwila said.
And Ms. Mwila noted that there might be some disruptions in businesses due to the elections frenzy, therefore the Kwacha is not expected to appreciate much.
“But because of the elections frenzy, there might be some disruptions in businesses and because of that we do not expect the Kwacha to appreciate as much so that’s why we are saying the losses will be minimized going forward,” she added.
The local currency has opened the market trading at K22.37 Ngwee and K22.80 Ngwee.
Kwacha expected to record minimal losses
