WEEKAHEAD-AFRICA-FX-Zambian kwacha seen firm, Ugandan shilling weak - REUTERS
LUSAKA, Dec 6 (Reuters) - The Zambian currency is likely to firm in the coming week as companies sell dollars to pay salaries and other month-end dues, while Ghana’s cedi is seen flat on expected offshore inflows.
The kwacha is likely to firm in the coming week due to increased supply of dollars from companies preparing to pay salaries and other month-end obligations.
At 0922 GMT on Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 11.8000 per dollar from a close of 12.0000 a week ago.
“It is likely to appreciate because of the month-end obligations that have to be met before corporates go on industrial break,” one senior commercial bank trader said.
The Ugandan shilling is seen trading with a bias towards the weaker side as some banks pick up hard currency to cover short positions as they prepare to close their books for the year.
At 1010 GMT, commercial banks quoted the shilling at 3,730/3,740 against the dollar, compared with last Thursday’s close of 3,720/3,730.
“We anticipate the shilling to remain inclined on the depreciation side as some banks who want to go long on the dollar side will be exerting demand,” said Faisal Bukenya, head of treasury at Exim Bank.
The Tanzanian shilling is expecting to hold steady, with an anticipated central bank sell-off of dollars helping ease tightness in the supply of hard currency.
Commercial banks quoted the local currency at 2,305/2,350 against the dollar on Thursday, unchanged from last Thursday’s close.
“We forecast the shilling to remain stable in the coming week because the market expects the central bank to supply dollars,” a trader at one of the leading commercial banks said.
The Kenyan shilling is seen stable in the coming week, supported by tight local currency liquidity in the money market and inflows from diaspora remittances.
Commercial banks quoted the shilling at 102.55/75 per dollar on Thursday, compared with 102.40/60 at last Thursday’s close.
“Markets will be liquidity guided with a bias for further tightening as we approach a new credit cycle ... There is a lot of demand for Kenyan shilling,” said a senior trader from one commercial bank.
Ghana’s cedi is seen flat next week on expected offshore inflows for a two-year bond issuance on Thursday, which could offset greenback demand by businesses stocking up for Christmas, analysts said.
The cedi has been under pressure in recent weeks as corporate and commerce operators seek more dollars for their end-of-year imports. It was trading at 4.99 to the greenback mid-morning Thursday, compared with 4.95 a week ago.
“We anticipate (dollar) supply to be stable in the market and we do not expect any significant external pressures in the week ahead on the cedi,” currency analyst Raphael Adubila said. (Reporting by Chris Mfula, Elias Biryabarema, Nuzulack Dausen, John Ndiso and Kwasi Kpodo; Compiled by Chris Mfula; Editing by Mark Potter)