Nigeria's naira is expected to strengthen against the dollar next week, while Kenya's, Uganda's and Tanzania's shillings are likely to ease due to high dollar demand from oil importers.
NIGERIA The naira should strengthen marginally next week to around 155 to the dollar on expectations of large dollar sales by some energy companies and with support from increasing sales at the central bank's forex auction.
The naira eased to its weakest in more than 18 months last week, trading at 156.90 to the dollar as businesses and rich Nigerians took long dollar positions ahead of April polls.
The central bank started trading in short-dated forex forwards on Wednesday, selling $16.6 million in 30-, 60- and 90-day forwards in a move to strengthen the naira and help deepen the foreign exchange market.
KENYA After rebounding from a record low in the last nine sessions, Kenya's shilling is likely to retreat as oil importers step up demand for dollars towards the end of the month.
Commercial banks quoted the unit at 84.90/85.00, stronger than last Thursday's close of 85.50/60, due in part to the central bank raising its key lending rate by 25 basis points to 6 percent to defend the weak currency.
"We are still expecting oil demand to come in because it is end-month and they have big orders waiting," said Bhavin Chandaria, a trader at Imperial Bank. "Inflows have remained quite low. We may start to see tea inflows from April onwards." Traders said the shilling would probably trade in the 84.80-85.80 range.
UGANDA Uganda's shilling is likely to ease amid strong corporate demand for dollars, although it is unlikely to push a March 16 record low of 2,425/9. Commercial banks quoted it at 2,402/2,407 to the dollar compared with last Thursday's close of 2,408/2,412.
"We're going to see some dollar demand over the next week, this being around end of the month," said Lucas Ochieng, a trader at Orient Bank. "But there might also be some inflows and I think overall the rate will oscillate in a small range."
ZAMBIA The kwacha is expected to gain from a month-low of 4,860 against the dollar hit last week as concern about political turmoil in North Africa and the Middle East caused investors to dump risky assets for in safe-haven dollar assets.
Commercial banks quoted the unit at 4,730 to the dollar on Thursday from 4,805 a week ago. Zambia's currency met firm resistance around 4,600 during 2010. On the few occasions it breached that level, it went on to test but failed to breach 4,550.
GHANA The cedi is expected to continue trading in a tight range, with the central bank apparently happy to sell dollars to offset corporate demand, most notably from importers. The central bank seemed keen to support the cedi around 1.5250-1.5350, said Kofi Pianim of Stanbic.