Market News

By Reuters

ACCRA, June 11 (Reuters) – The Ghanaian and Zambian currencies are expected to strengthen against the U.S. dollar in the week to Thursday, while Nigeria's naira is likely to remain broadly stable, according to traders.

Ghana

Ghana's cedi could draw support from improved foreign-currency liquidity following continued interventions by the central bank.

LSEG data showed the cedi trading at 11.30 to the dollar, compared with 11.80 a week earlier.

"We expect the cedi to trade stronger against the dollar in the week ahead, supported by ebbed corporate FX demand and improved interbank liquidity," said Andrews Akoto, Head of Trading at Absa Bank Ghana.

"Recent central bank interventions have effectively cleared the persistent corporate FX demand that weighed on the currency in May. This softening demand for the greenback is underscored by the central bank FX auction on Tuesday, where bids reached only 44% of the total amount on offer," he added.

Zambia

Zambia's kwacha is expected to gain ground due to robust copper prices, supportive central bank policies, and positive market sentiment.

Commercial banks quoted the currency of Africa's second-largest copper producer at 17.54 per dollar, stronger than 17.92 a week earlier.

"The mining sector continues to anticipate robust full-year growth, which should help offset the negative impact of higher oil prices on the current account. Further supporting the bullish case is the substantial improvement in economic fundamentals," said Diego Barnuevo, a market analyst at financial services firm Ebury.

Nigeria

Nigeria's naira is expected to remain stable, underpinned by dollar sales by the central bank.

LSEG data showed the naira at 1,360 to the dollar in intraday trading, unchanged from a week earlier.

On the street market, the currency traded around 1,390 to the dollar.

"We expect the naira to remain stable as the central bank continues to sell dollars and keep up its aggressive OMO (Open Market Operations) programme to mop up naira," one trader said.

Reporting by Christian Akorlie, Chris Mfula and Elisha Bala-Gbogbo; Editing by Alexander Winning.