LOCAL CURRENCY DEPRECIATES AGAINST MAJOR TRADING CURRENCIES

A monthly economic review for May 2020 by the Reserve Bank of Malawi (RBM) has shown that the Malawian Kwacha depreciated against major trading currencies.

The review which is prepared with the aim of providing current economic information reveals that the Malawian Kwacha depreciated against Euro as it remained stable against the United States dollar.

"The Malawian Kwacha remained broadly stable against the United States dollar and traded at K741.38 per dollar at end May 2020. Conversely, the local currency slid by 2.9 percent against the Euro and traded at K833.38 per Euro, following strengthening of the Euro as most economies in the Euro area  began to relax some of the restrictions which were imposed in light of the Corona virus pandemic". Reads part of the document.

The Malawian Kwacha further depreciated in the SADC region against the South African rand by 3.6 percent and traded at K43.14 per rand, an out turn explained by strengthening of the rand following an announcement by the South African Reserve Bank (SARB) that it would purchase government bond directly from the Secondary market to improve the county's liquidity condition.

"The local currency depreciated by 2.4 percent against the Zambian Kwacha (ZMK) and traded at K40.43 per ZMK primarily reflecting the strengthening of the ZMK due to improved investors confidence as the country planned to restructure its rising and unsustainable external debt".

However, the local currency exhibited mixed performance against the rest of its trading partners currencies as  it appreciated against the British pound by 0.9 percent and traded at K920.44 per pound.

The Malawian Kwacha further gained some strength against currencies in the Asian region as most Asian economies currencies weakened due to the effects of Corona virus crisis.

The document reads, ; " The local currency gained value by 0.5 percent against Japanese yen, 1.3 percent against Chinese yuan, and 0.5 percent against Indian rupee and traded at K6.88 per yen, K103.08 per Yuan, and K9.75 per rupee respectively ".