Kampala — Uganda’s currency is expected to weaken against the dollar in the next week to Thursday, while those of Nigeria, Ghana, Kenya and Zambia should be little changed, traders said.
UGANDA
Uganda’s shilling is seen falling on the back of dollar demand from foreign-owned firms looking to pay dividends.
Commercial banks quoted the shilling at 3,595/3,605 to the U.S. currency, compared to last Thursday’s close of 3,585/3,595.
“It’s around time when foreign-owned entities are paying their last year’s dividends … some are exerting demand for that purpose,” one trader said.
He said the local unit would likely trade in the 3,580-3,620 range against the dollar in the coming week.
NIGERIA
Nigeria’s naira should be stable, supported by central bank interventions to support the currency.
The naira was quoted at 1,354 to the U.S. currency on the official market on Thursday, compared with 1,357 a week earlier.
The currency was changing hands at 1,365 to the dollar in street trading.
“I expect the market to be stable around 1,350 to 1,360 naira next week,” a trader said.
“I think this corridor should serve for next week. The central bank has participated in the market on both sides … in the last one to two weeks.”
GHANA
Ghana’s cedi is expected to be range-bound because of muted corporate dollar demand and central bank forex auctions.
LSEG data showed the cedi trading at 10.60 to the dollar compared with 10.99 a week ago.
“Corporate dollar demand has stayed subdued, while improved FX inflows from the mining sector and sustained intermediation by the central bank through its auction programme have strengthened near-term supply,” said Ronald Mensah, a trader at Stanbic Bank Ghana.
“We expect this constructive tone to persist in the coming sessions, underpinned by balanced flows and continued policy support,” he added.
Andrews Akoto, head of trading at Absa Bank Ghana, said forex demand from the energy and commerce sectors had softened while mining inflows were steady and interbank liquidity had improved.
*Elias Biryabarema, Chijioke Ohuocha, Christian Akorlie, Vincent Mumo Nzilani & Chris Mfula; editing: Alexander Winning – Reuters
