Kenya shilling seen easing next week, Tanzania's stable

NAIROBI: Kenya's shilling is forecast to weaken against the dollar in the next week to Thursday, traders said, while Tanzania's currency is expected to hold steady.

KENYA

Kenya's shilling is expected to weaken, undermined by increased dollar demand from various sectors, and little inflows.

Commercial banks quoted the shilling at 109.95/110.15 to the dollar, compared with last Thursday's close of 109.45/65.

"It (demand) is across the board, right from large corporates, SMEs (small businesses). As the economy opens and things pick up, then obviously it feeds into demand," a trader at one commercial bank said.

"The pressure remains. Banks are generally short (of dollars)."

TANZANIA

Tanzania's shilling is expected to hold steady next week as agricultural exports balance the demand from corporates and small and medium enterprises.

Commercial banks quoted the shilling at 2,314/2,324 on Thursday, unchanged from a week earlier.

"We expect a stable shilling next week the same as a week ago as agricultural exports balance FX flows against moderate demand from corporates and SMEs," said Terry Karanja, a treasury associate at AZA, a Nairobi-based FX trading firm.

NIGERIA

The naira is seen trading within a range next week as the forex market weighs the level of dollar demand and the central bank's willingness to clear the backlog after the currency eased 11.2% last year, traders said.

The naira opened at 392.69 on the over-the-counter spot market on Thursday, its trading range so far this year. The currency was quoted at 474 naira on the black market.

The currency has been under pressure on the black market , where it trades more freely, widening the gap with the official rate and prompting calls from the World Bank for Nigeria to unify rates to attract inflow.

The naira is quoted at 381 to the dollar on the official market, a level set in July and backed by the central bank.