Kwacha stable amid dollar supply as copper nears multi-month highs

The Zambian Kwacha held steady on Monday, trading just below the K24.000 per dollar mark.

On a month-to-date basis, the local unit has slipped about 0.83 percent, ranking among the worst-performing African currencies due to persistent liquidity constraints.

However, Absa Bank noted in its daily market update that Monday’s session saw the kwacha trade favorably against major currencies, supported by sufficient dollar supply to meet demand.

“At 08:30 hours, commercial banks in Lusaka quoted the USD/ZMW interbank rate at K23.650/23.700 on the bid-offer, before the kwacha gained 4 ngwee to close the day at K23.610/23.660,” the update stated.

Absa added that current market dynamics suggest the local currency is likely to remain within a stable range, with pricing shaped by both economic sentiment and market forces.

Meanwhile, in the base metals market, copper held just below its strongest level since May 2024 after rallying more than 15 percent this year, as traders positioned for the U.S. Federal Reserve’s expected first interest rate cut since Donald Trump’s return to office.

A weaker dollar and expectations of looser monetary policy have buoyed demand for industrial metals.

Copper rose more than one percent on Monday before easing 0.4 percent to $10,150 per ton in early Tuesday trading.

Other base metals also softened slightly, with aluminum retreating from a six-month high and zinc edging lower after its highest close of the year.

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