• On Monday and Tuesday last week, the local unit depreciated by 0.32% but gained on Wednesday to Friday by 0.38 %.
• During the second half of the week, Bank of Zambia entered the interbank market and provided supply support of about US$57 million.
• This explains why the local currency was gaining, erasing earlier losses.

An Economist has disclosed that the Kwacha is expected to remain stable throughout this week due to enhanced Foreign Exchange (FX) support from Bank of Zambia.
Speaking in an interview with Money FM News, Gerald Soko noted that on Monday and Tuesday last week, the local unit depreciated by 0.32 percent but gained strength on Wednesday through to Friday by 0.38 percent, representing net marginal gain of 0.08 percent.
Mr. Soko explained that the appreciation witnessed in the last three days was stronger than the depreciation in the first two days of last week.
“The Kwacha last week was stable but on Monday and Tuesday it depreciated and on Friday we saw it gaining momentum in terms of appreciation. On Monday and Tuesday last week, the Kwacha weakened by 0.32 percent, and then Wednesday through Friday it appreciated by 0.38 percent. So the net you get was a very marginal gain of 0.08 percent.”
“So in net terms, yes stable but with an appreciation bias so that means that the appreciation that we saw in the last three days was actually stronger than the depreciation in the first two days but pretty much flat,” Mr. Soko noted.
He said during the second half of the week, Bank of Zambia entered the interbank market and provided FX supply support of about US$57 million, resulting in the appreciation of the Kwacha.
“During the second half of the week, we saw the Bank of Zambia coming into the market in terms of providing supply support, I think about US$57 million was sold during the last three days and therefore explaining why the local currency was actually gaining, erasing earlier losses,” he stated.
Mr. Soko further said the currency is likely to continue stabilizing because the Central Bank does not want it to approach the K16 per US dollar mark, but maintain the current levels.
“This week I think the Kwacha will remain stable, the enhanced support that is coming from the Central bank that we saw last week, actually started the other week and so I think we are likely to continue seeing stability, the Central Bank should be able to continue coming through to support it.”
“But also I think the good news is that yes, there is a certain section of people that have raised issues but generally the 2023 national budget has received a positive nod in terms of what it seeks to address so no risks coming from the budget itself, therefore I think its stability that we expect to continue seeing this week,” he added.
Today Thursday October 6 2022, some commercial banks in Lusaka have quoted the local unit at K15.61 and K15.92 on the bid and offer respectively.