Kwacha Firms as Dollar Softens Across Banks, Exporters Gain While Importers Feel the Pinch

The Zambian kwacha ended today’s trading session firmer against the United States dollar, emerging as the day’s clear winner on the foreign exchange market as most commercial banks quoted lower dollar buying and selling rates by the close.

Market data from commercial banks showed the average interbank buying rate easing to K22.23 per dollar at 15:30 from K22.44 earlier in the morning, while the average interbank selling rate softened to K22.63 from K22.49. The trend pointed to sustained kwacha strength throughout the day, supported by improved market liquidity and steady foreign currency inflows.

Banks such as Stanbic, Standard Chartered and Access Bank quoted some of the lowest interbank selling rates by the close, with rates converging around K22.60 per dollar. Retail rates followed a similar pattern, with the market average retail selling rate easing slightly to K22.63, offering marginal relief to consumers and businesses purchasing foreign currency late in the day.

Export-oriented sectors emerged as the day’s biggest winners, benefiting from a firmer local currency that reflects improving confidence in the domestic market. Lower dollar demand also suggested reduced pressure from importers and a calmer end-of-year trading environment.

On the losing side, import-dependent businesses faced tighter margins as the stronger kwacha reduced the local currency value of dollar holdings accumulated earlier in the session. Currency traders holding long dollar positions were also pressured by the steady decline in rates across most banks as the day progressed.

Overall, the forex market closed with the kwacha in a stronger position, reinforcing recent signs of relative stability and suggesting that near-term currency pressures remain contained, barring unexpected shifts in external or domestic conditions.