KENYA Kenya's shilling is expected to weaken in the next week as the current account deficit exerts downward pressure on the local unit. Commercial banks quoted the shilling at 136.70/90 per dollar, compared to last Thursday's close of 136.35/55. "I think we'll continue to see a bit of pressure until the liquidity regularizes," a trader at one commercial bank said. The shilling is down more than 20% against the dollar in the last two years, and hit a fresh record low of 136.80/137.00 on Thursday, according to Refinitiv Eikon data. Traders said the shilling could see some support in the coming weeks, with the anticipated introduction of oil import deals that should ease persistent FX demand from fuel importers.
NIGERIA Nigeria's naira is seen weakening in the coming week after the currency dropped to a record low on Thursday following the central bank's adjustment on the official market the previous session, traders said. The naira fell to 466 per dollar on Thursday, outside a range of 460 to 462 where it has been stuck on the official market since the end of last year. The central bank sold dollars at 465 naira on Wednesday from 460 naira previously, traders said. "The market is most likely going to move upwards in the coming week," one currency trader said.
GHANA Ghana's cedi is expected to remain stable over the next week due to muted demand for foreign exchange. Refinitiv Eikon data showed the cedi trading at 11.5800 to the dollar on Thursday, compared to 11.5500 at last Thursday's close. "The cedi has remained stable over the past week on the back of matched demand and supply and we expect further cedi stability in the coming sessions," said Stanbic Bank Ghana trader Selasi Kabo. "FX demand from the real sectors remains contained," Andrews Akoto, Head of trading at Absa Bank Ghana Limited said, adding that the central bank was expected to sell $20 million to oil importers at an auction on Friday.
UGANDA The Ugandan shilling is expected to remain stable in the week ahead as demand for hard currency is trimmed by mid-month tax payments, traders said.
At 0859 GMT, commercial banks quoted the shilling at 3,715/3,725, compared to last Thursday's close of 3,713/3,723.
"Mid-month taxes will put a lid on appetite for dollars," said one trader at a commercial bank in the capital Kampala, adding he expected the local unit to swing in the 3,710-3,730 range over the next one week.
ZAMBIA Zambia's kwacha is likely to hold steady against the dollar next week as companies prepare to pay taxes in the local currency. On Thursday, commercial banks quoted the currency of Africa's second-largest copper producer at 18.4500 per dollar compared to 18.0700 at the close of business a week ago. "Corporates, including mining companies will be selling dollars to settle Pay As You Earn, Withholding Tax and Value Added Tax," one financial analyst said. Zambia defaulted on its debt in 2020 and has struggled to agree a relief deal with lenders, who are expected to meet this week to consider the nation's proposal for debt restructuring. (Reporting by Christian Akorlie, Hereward Holland, Elias Biryabarema, Chris Mfula and Chijioke Ohuocha; Compiled by Bhargav Acharya)
