LUSAKA: Zambia’s currency is expected to remain under pressure in the next week to Thursday, while those of Nigeria, Ghana and Uganda are seen broadly steady, traders said.
Nigeria
Nigeria’s naira is seen rangebound because of frequent central bank dollar sales to support the currency.
The naira was quoted at 1,501 to the dollar on the official market on Thursday, LSEG data showed, compared with a closing quote of 1,508 naira a week earlier.
The currency was changing hands at 1,498 naira to the dollar in street trading on Thursday.
“I expect the naira to trade between 1,490 naira and 1,510 naira range next week,” one trader said. “I don’t think the government is interested in seeing rates go below 1,500 naira since that’s where they pegged the budget FX rate.”
Nigeria’s central bank keeps main interest rate unchanged
Ghana
Ghana’s cedi is expected to be little changed from its current levels, extending a recent period of stability on the back of weak foreign-currency demand and increased central bank support.
LSEG data showed the cedi at 15.45 to the dollar on Thursday, compared to 15.50 at last Thursday’s close.
“The cedi traded relatively stable against the dollar in the past week. … We expect a similar narrative in the coming week, with supply and demand for FX in relative equilibrium,” said Sedem Dornoo, a senior trader at Absa Bank Ghana.
Another trader said dollar demand from the energy, manufacturing and services sectors, which account for the bulk of hard-currency demand, was subdued.
Uganda
Uganda’s shilling is seen trading in a broadly stable range, drawing some support from coffee exports.
Commercial banks quoted the shilling at 3,676/3,686 to the dollar, compared to last Thursday’s close of 3,665/3,675.
“We are seeing elevated flows from the coffee sector which we anticipate will be the main driver of the shilling’s direction in the short term,” said a trader.
He said the local unit was likely to oscillate in the 3,650-3,680 range in the coming week.
Zambia
Zambia’s kwacha is likely to remain under pressure as demand for hard currency continues to outstrip supply.
On Thursday the kwacha was quoted at 28.36 per dollar from 28.15 per dollar a week ago.
“Near term, the kwacha is likely to continue posting minor losses on the back of thin supply,” Zambia National Commercial Bank said in a note.
