Feb 22 (Reuters) –Uganda’s and Ghana’s currencies are expected to weaken against the dollar in next the week to Thursday, while Kenya’s, Nigeria’s and Zambia’s are expected to be broadly stable, traders said.
UGANDA
The Ugandan shilling UGX= is seen extending its recent losses in the coming days due to end-of-month foreign-currency demand from merchandise importers and players in the interbank market.
Commercial banks quoted the shilling at 3,885/3,895 to the dollar, compared with last Thursday’s closing rate of 3,770/3,780.
One trader said he anticipated a typical month-end rise in demand for hard currency from importers, and that it could push the shilling over 3,900.
GHANA
Ghana’s cedi GHS= is expected to face more pressure this week due to increased demand for dollars from corporates, mainly in the energy and agricultural sectors.
LSEG data showed the cedi trading at 12.5000 to the dollar on Thursday, compared to 12.4000 at last Thursday’s close.
“The cedi has lost ground to the greenback in recent sessions on the back of elevated FX demand. Demand has mainly been from the energy and agricultural sectors,” said Sedem Dornoo, a senior trader at Absa Bank Ghana.
Head of trading at Stanbic Bank Ghana, Chris Nettey, said: “We expect a gradual depreciation of the cedi amid the demand pressures, with some support from the central bank in the coming week”.
KENYA
Kenya’s shilling KES= is expected to hold steady, with importer demand for dollars being matched by inflows from tea exporters and companies converting dollars to pay salaries.
Commercial banks quoted the shilling at 145.50/146.50 per dollar, compared with last Thursday’s closing rate of 145.00/146.00.
“We are seeing a bit of stability for the last few days. The only inflows that we have seen were from the tea sector… and that is what has stabilised the market,” one trader said.
“It is going to be very steady. Mostly because we are going to payroll… we tend to have lots of supply,” he added.
NIGERIA
Nigeria’s naira NGN=D1 is seen trading around current levels next week, after traders said the central bank sold dollars this week to boost liquidity.
The naira was quoted at 1,697 to the dollar on the official market on Thursday, after hitting a record low of 1,713 on Feb. 21. The unit has fallen across the curve on the forwards market.
The central bank sold $100 million this week, bringing its total interventions in the market since the start of last week to $300 million, one trader said.
“The market is still short on liquidity and what the central bank is doing is targeted intervention. I expect the naira to trade at its current level until there is enough liquidity to stabilise the market,” he said.
ZAMBIA
Zambia’s kwacha ZMW= will likely hold on to its recent gains next week, supported by corporates converting dollars to meet month-end obligations.
On Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 22.80 per dollar from 26.40 a week a ago.
“The local unit is predicted to exhibit forms of stability in the short term as month-end conversions are expected,” Access Bank said in a note.
Reporting by George Obulutsa, Elias Biryabarema, Elisha Bala-Gbogbo, Christian Akorlie and Chris Mfula; Editing by Nellie Peyton