Market News

The currencies of Kenya, Nigeria and Zambia are expected to be under pressure in the next week to Thursday, while Ghana's will remain broadly steady and Uganda's could gain against the dollar, traders said.

KENYA

Kenya's shilling USDKES is seen weakening as some banks pay last year's dividends.

Commercial banks quoted the shilling at 129.30/129.50 to the U.S. dollar, compared to last Thursday's close of 129.00/129.40.

"As banks announce their results, offshore people will be looking to buy dollars to repatriate their dividends," one trader said.

"I would say there's a bit of pressure and if the central bank doesn't intervene it will weaken a bit more."

NIGERIA

Nigeria's naira is expected to lose ground on the official and parallel markets, as foreign-currency demand outstrips central bank supply.

The naira USDNGN was quoted around 1,550 to the dollar in intraday trading on Thursday, traders said, compared with a closing quote of 1,520 naira a week earlier.

The unit was sold at around 1,570 naira to the dollar in street trading (NGNP=) on Thursday.

"Rising dollar demand has upset the stable rates we've seen in the last couple of weeks, despite the central bank interventions, and the gap with the black market is now opening up again," a trader said.

"I see rates falling further unless supply improves," he said.

GHANA

Ghana's cedi USDGHS is seen remaining stable, helped by central bank support.

LSEG data showed the cedi at 15.45 to the dollar on Thursday, unchanged from last Thursday's close.

"Cedi has maintained its stability this week amid matched demand and supply, anchored by central bank's FX auctions. We expect this trend to continue into next week," said Chris Nettey, head of trading at Stanbic Bank Ghana.

"We have seen some increased demand for the (dollar/cedi) pair, however, it has been marginal. With continued support from the central bank, we expect the pair to remain stable in the near term," Sedem Dornoo, a senior trader at Absa Bank, said.

UGANDA

Uganda's shilling USDUGX is likely to strengthen as some companies prepare for mid-month tax payments.

Commercial banks quoted the shilling at 3,662/3,672 to the dollar, compared to last Thursday's close of 3,665/3,675.

A trader said he anticipated a decline in appetite for dollars as banks and other large firms clear their mid-month tax obligations.

"The local unit may draw a bit of strength from that," he said, forecasting the shilling may trade in the 3,630-3,660 range against the dollar.

ZAMBIA

Zambia's kwacha USDZMW is expected to be on the back foot because of rising demand for hard currency and limited supply.

On Thursday the kwacha was quoted at 28.58 from 28.70 a week ago.

"Foreign currency conversions may not be sufficient to trigger gains but could merely slow depreciation," Access Bank said in a note.

Increased imports of food and electricity have contributed to the depreciation of Zambia's currency in recent months.