Sat, 03 Jun 2017 12:30:46 +0000
By BUUMBA CHIMBULU
THE Central Bank on Thursday conducted reverse Open Market Operations (OMO) and was looking to lend K400 million to commercial banks.
Reverse OMO is a situation where the Central Bank lends money to commercial banks in a bid to stabilise the local currency.
According to Cavmont Bank Zambia daily market report, the reverse OMO came as a result of the loss experienced by the Kwacha during the course of last week.
“The Kwacha lost further ground against the U.S dollar during Thursday’s trading session as supply waned further,
“The local unit started the month of June at K9.270 / K9.320, but was later seen being quoted at K9.300 / K9.350 where it traded until close of the market,” read the report.
During the Thursday trading session, the local unit showed no clear direction in early trade following subdued activity from corporates.
Cavmont Bank however indicated that despite the currency’s recent weakness, it was likely to remain range bound as demand from importers remained largely weak.
On the money market, commercial banks’ aggregate current account balance increased by K125.54 million to K2, 208.30 million while the overnight borrowing and lending increased by rate 0.07 percent to 14.00 percent.
Total funds therefore traded on Interbank were K126.50 million.
