NAIROBI: The Nigerian, Kenyan, Zambian and Ugandan currencies are seen weakening in the week to Thursday, due to unmatched dollar demand early in the new year.
NIGERIA: Nigeria’s naira is seen weakening on the official market after the currency dropped to a record low due to a backlog demand for foreign exchange, traders said.
The currency eased to a new band of between 460 naira and 462 naira to the dollar on Thursday, weaker than last week’s range of between 455 naira and 457 naira on the official market.
“The rate is weakening and I think it will weaken further by the end of the year,” a currency trader at a local bank said.
“It should hit about 465 levels.”
KENYA: Kenya’s shilling is expected to weaken on increased demand for dollars from importers, especially oil companies.
Commercial banks quoted the 123.20/40 per dollar, compared with last Thursday’s close of 123.15/35. In early Thursday trade, the shilling hit a new all-time low of 123.35/55 before recovering some of its losses, according to Refinitiv data.
“It still remains the same direction ... weakening,” a trader at one commercial bank said. “The oils (oil companies) will be back, they are the main buyers.” The trader said they would also be on the lookout for central bank selling dollars, which could give the shilling some reprieve. The bank says it only intervenes in the market to smooth out any volatility in either direction, and has no preferred level for the shilling.
ZAMBIA: The kwacha is expected to remain on the back foot against the dollar this week due to a sustained rise in demand for the greenback, while supply remains minimal.
On Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 18.1900 per dollar from 18.0200 at the close of business a week ago.
UGANDA: The Ugandan shilling is seen weakening in the coming days, undermined by strong demand from commercial banks looking to beef up their hard currency positions as the new year gets underway.
At 1020 GMT commercial banks quoted the shilling at 3,750/3,760, compared to last Thursday’s close of 3,640/3,650.