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Zambian financial markets reopened on Tuesday, April 29, 2025, after closing on Monday for the Kenneth Kaunda Day public holiday, with the kwacha expected to face fresh pressure amid rising demand for hard currency.
The local currency had closed last week on a strong note, gaining 0.38 percent on Friday to settle around K28.0000 per US dollar.
This followed a 1.46 percent rise on Thursday, buoyed by central bank intervention, marking the kwacha’s first weekly advance in three weeks.
However, analysts warn that the gains may prove short-lived. According to Absa Bank’s daily market commentary, the kwacha’s performance on Friday was supported by sufficient dollar supply from market participants, which met the day’s relatively strong demand.
Read more: Zambian Kwacha under pressure as dollar supply tightens
“The local unit’s interbank was quoted at K28.0000/28.0500 before firming to close 10 ngwee stronger at K27.9000/27.9500 per dollar. The next direction of the currency pair will be driven by the forces of supply and demand,” the commentary noted.
Meanwhile, the South African rand, after weakening late last week, firmed on Monday during thin holiday trade, benefiting from a softer US dollar.
The USD-ZAR pair dipped below 18.6000 and briefly tested 18.5000.
Analysts say political stability in South Africa, particularly within the Government of National Unity (GNU) and upcoming budget discussions, have raised hopes for a fiscally disciplined budget that could support long-overdue reforms.
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