KAMPALA: The Nigerian and Ugandan currencies are seen advancing in the next week to Thursday, while Kenya’s, Ghana’s and Zambia’s are expected to be broadly stable, traders said.
Uganda
Uganda’s shilling is expected to strengthen thanks to limited importer appetite for hard currency and healthy inflows from remittances and commodity exports.
Commercial banks quoted the shilling at 3,582/3,592 to the dollar compared to last Thursday’s close of 3,588/3,598.
“Importers have largely remained on the sidelines and that will likely remain the case for a while,” one trader said.
He attributed weak importer appetite to slow consumer spending typical at the beginning of the financial year, which runs from July to June.
The market, he said, is receiving significant dollar inflows from diaspora workers.
Ugandan shilling firms on commodity dollar inflows
Nigeria
Nigeria’s naira could appreciate, helped by central bank support and foreign demand for short-term government debt due to high yields.
The naira was quoted at 1,525 naira to the dollar on the official market on Thursday, compared with a closing quote of 1,535 naira a week earlier.
The currency was changing hands at 1,567 naira to the dollar in street trading on Thursday.
“In the past couple of weeks we have seen appreciation and we expect that to continue,” a trader said.
“I see the naira heading towards 1,500, which is the (government’s) budgeted level.”
Kenya
Kenya’s shilling is seen stable, supported by hard-currency inflows from exports of commodities like tea and flowers.
Commercial banks quoted the shilling at 129.00/129.50 to the U.S. currency, flat from last Thursday’s close.
Ghana
Ghana’s cedi is forecast to be steady as the central bank continues to sell dollars to meet demand on the interbank market.
LSEG data showed the cedi trading at 10.30 to the dollar, the same level as a week ago.
“We expect the currency to hold steady in the coming week, as firm FX demand, primarily from the energy and manufacturing sectors, is offset by FX supply from the central bank,” said Andrews Akoto, head of trading at Absa Bank Ghana.
“The daily central bank auctions are expected to continue, partly supported by strong gold export receipts,” he added.
Chris Nettey, head of trading at Stanbic Bank Ghana, also expected the cedi to stay stable.
Zambia
Zambia’s kwacha is likely to trade around current levels next week.
On Thursday the kwacha was quoted at 24.45 per dollar from 23.61 a week ago.
“We anticipate the kwacha to trade within range but (it) could post minor losses owing to corporate U.S. dollar appetite,” Zambia National Commercial Bank said in a note.
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