Market News

Elias Biryabarema, Chris Mfula, George Obulutsa, Chijioke Ohuocha and Christian Akorlie

KAMPALA, Sept 11 (Reuters) – Uganda’s currency is expected to extend gains against the dollar in the next week to Thursday, Zambia’s could fall further, and the Kenyan, Nigerian and Ghanaian currencies should be steady, traders said.

UGANDA

Uganda’s shilling is seen trading with a firming tone as some companies keep their local-currency holdings for mid-month tax payments.

Commercial banks quoted the shilling at 3,510/3,520 to the dollar, compared to last week’s close of 3,515/3,525.

“Being around mid-month we anticipate a slowdown in (dollar) appetite because of tax obligations,” one trader said.

The shilling has been posting steady gains on the back of weak dollar appetite and strong inflows from coffee exports.

ZAMBIA

Zambia’s kwacha is likely to stay on the back foot because of liquidity constraints.

On Thursday the kwacha was trading at 24.32 per dollar from 24.10 a week earlier.

“The kwacha is likely to remain on its weakening trajectory,” Access Bank said in a note.

KENYA

Kenya’s shilling has been little changed all year, and that trend is forecast to continue.

Commercial banks quoted the shilling at 129.00/129.50 on Thursday, unchanged from last Thursday.

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A trader forecast “a very stable currency at the same levels, because I think we’re adequately funded. I don’t foresee it losing or gaining”.

NIGERIA

Nigeria’s naira could stabilise after appreciating this week, helped by dollar sales by the central bank, exporters and portfolio investors.

The naira was quoted around 1,502 to the dollar on Thursday versus last week’s closing quote of 1,524.

The currency was changing hands around 1,538 to the dollar in street trading NGNP= on Thursday.

“We are seeing some resistance around 1,502/03 level. Into next week demand will play a major role. I think we would hover around 1,500 level,” a trader said.

GHANA

Ghana’s cedi should be stable as the central bank has increased the size of its forex auctions to meet demand on the interbank market.

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LSEG data showed the cedi trading at 12.15 to the dollar on Thursday, compared to 11.95 at last Thursday’s close.

“(The cedi) is likely to remain range-bound in the coming week as interbank liquidity improves and the central bank doubles FX auction sizes to $200 million from $100 million. Corporate demand, particularly from the services sector, is expected to stay firm,” said Andrews Akoto, head of trading at Absa Bank Ghana.

“Upcoming inflows from the cocoa sector, reportedly totalling $4 billion from international buyers in the coming months, are also expected to support the currency,” he added.

(Reporting by Elias Biryabarema, Chris Mfula, George Obulutsa, Chijioke Ohuocha and Christian Akorlie;Editing by Alexander Winning)