African currencies week ahead: Pressure ahead for kwacha, naira; but cedi to gain

Zambia's kwacha is set to extend its losses against the dollar next week, weighed down by weak copper prices and general risk aversion following Greece's debt default. The Nigerian naira is also likely to remain under pressure on the thriving black market but Ghana's cedi is seen firming after a heavy sell-off that pushed it to record lows.
ZAMBIA: The kwacha climbed 1 percent to a session high of 7.6800 per dollar on Thursday, but was still weaker than its 7.5200 level of a week ago. "Concerns out of Europe and China will continue to weigh on the currency," a commercial bank trader said, referring to fears of contagion from the Greek crisis and concerns about growth in China, a key importer of commodities.
Standard & Poor's recent downgrading of Zambia's long-term credit rating to B from B+ and news that Africa's second largest copper producer plans to cut power supplies to mines are keeping the kwacha under pressure, another trader said.
NIGERIA: Traders expected Nigeria's naira to hold steady on the official interbank market while weakening in the parallel market as the central bank continues to restrict importers' access to foreign exchange.
The local currency hit a new record low of 235/dollar in informal trade on Thursday, weaker from 230 last week. On the sanctioned market it was quoted at 199.45 compared with 196.95 a week ago.
Some people were hoarding dollars in anticipation of further naira weakness, the president of Nigeria's Bureau de Change association Aminu Gwadabe told Reuters. "We see the naira cross 240 next week if the central bank fails to do something about it," Gwadabe said. The Central Bank of Nigeria has said the parallel market is too shallow to force it to devalue the currency.
GHANA: Ghana's cedi was expected to add to this week's gains, helped by central bank dollar sales and offshore inflows. After touching a record low of 4.4100 against the dollar earlier this month, the cedi has rallied significantly this week, reaching 3.6500 by 1045 GMT on Thursday compared with 4.3000 a week ago.
"We expect the cedi gains recorded so far to signal pressure on traders and firms that receive offshore dollars to offload their inflows to the market," said Joseph Biggles Amponsah of the Accra-based Dortis Research. Dollar/cedi could touch 3.3500 by next week if the central bank maintains its support, Amponsah added.
KENYA: The shilling is expected to stabilise as strong dollar demand subsides after pushing the local currency to 3-1/2-year lows this week, traders said. Commercial banks quoted the shilling at 100.50/70. It hit 100.80/90 earlier in the session, a level last seen in October 2011. "Panicky people who missed out at lower levels are coming in droves to buy dollars, which is putting pressure on the shilling. When that subsides, we could possibly see a stab at 99 levels," said a senior trader at one commercial bank.
TANZANIA: Tanzania's shilling could edge up next week, helped by a slowdown in importer demand and as the government receives hard currency from foreign lenders. Commercial banks quoted the shilling at 2,240/2,250 to the dollar on Thursday, weaker than 2,000/2,010 a week ago.
UGANDA: The outlook is steady for Uganda's shilling after the central bank sold an unspecified amount of dollars on Thursday to stem recent sharp losses. "What was worrying the shilling was the central bank's hands-off approach, which was sort of pushing the market into a panic," one trader said. "Their intervention today will go along way in restoring some calm so going forward we could see a stable range."