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The Zambian Kwacha halted its nine-day losing streak on Friday, gaining 0.21% against the U.S. dollar to close just below K19.75 per dollar, according to Bloomberg data.
The local currency’s advance came after it failed to sustain a break below the K19.70 per dollar level during intraday trading.
Despite Friday’s recovery, the Kwacha recorded its fifth consecutive weekly loss against the dollar, weighed down by a stronger greenback and continued demand for hard currency from corporates and importers.
Read more: Kwacha extends losses against dollar
Market conditions could provide some support for the kwacha this week as local companies meet month-end local currency obligations, potentially increasing demand for the domestic currency.
Meanwhile, the South African rand has also seen some easing in pressure against the dollar, with the USD/ZAR pair trading around 16.2250 after pulling back from levels near 16.4100.
The movement suggests that the dollar’s recent advance against the rand has lost some momentum, with resistance seen around 16.4100 and the 50% retracement level near 16.4300.
Support is currently positioned just below 16.2000, followed by 16.1700, with the anticipated daily trading range between 16.1700 and 16.4300.
Market indicators point to possible consolidation in the rand, while lower oil prices, stronger gold prices and attractive carry conditions are providing support despite continued geopolitical uncertainty.
The near-term outlook favours range-bound trading, although the South African Monetary Policy Committee decision and developments in energy markets could trigger a sharper move.
The market commentary indicates that an unchanged policy decision accompanied by a less hawkish stance could expose the rand to renewed pressure.
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