African currencies week ahead: bond flows to help Kenyan shilling, naira seen steady

Kenya's shilling could strengthen next week buoyed by offshore inflows into a Treasury bond on sale later this month, while the naira could steady as the central bank controls its trade.
KENYA: The shilling closed at around 91.05/15 to the dollar on Thursday, up from 91.30/40 a week ago. Traders the shilling could gain from hard currency inflows as foreign investors prepare to buy an infrastructure bond worth 25 billion shillings ($274.57 million) on March 25. "There is a lot of interest in this paper, and the market is expecting foreign participation to be around more than 60 percent," a senior trader at one commercial bank said.
NIGERIA: Nigeria's naira has tumbled on the political and economic turmoil, although dealers expected a steadier currency next week as the central bank maintains tight controls on trade. The central bank last month said it would sell dollars only at 198 naira to customers through the interbank. "There is not much activity going on in the market, we are just going with the flow as directed by the central bank," one dealer said.
Dealers said Nigeria's central bank has fixed the rate at which banks can buy dollars from oil companies at not more than 2 naira spread to its clearing rate.
GHANA: Foreign currency shortages have persisted in Ghana, keeping the cedi under pressure since mid January, but traders said this should lessen when a financial package from the IMF to help fix the economy starts. "Until then, (dollar) demand continues to increase and there is no major inflow expected in the coming week, so we expect some further losses for the cedi," Joseph Biggles Amponsah of the Accra-based Dortis Research said.
Finance minister Seth Terkper told Reuters the government would continue to use its Oil Stabilisation Fund as well as petroleum hedging to manage foreign exchange volatility in support of the local cedi currency.
TANZANIA: The Tanzanian shilling is expected to be range-bound in the days ahead, helped by a slowdown in demand for dollars from oil and manufacturing sectors. Commercial banks quoted the shilling at 1,835/1,845 to the dollar on Thursday, weaker than 1,830/1,840 a week ago. "We will likely trade at the same levels next week because most of the activities have slowed down," said Mohamed Laseko, a trader at CRDB Bank.
The central bank said it had traded $51.5 million on the interbank foreign exchange market in the past week.
UGANDA: Uganda's shilling could recoup some of its recent losses, after hitting a new all-time low on strong dollar demand from commercial banks and importers, triggering a dollar sale by the central bank to support the local currency. At 1120 GMT commercial banks quoted the shilling at 2,940/2,950, weaker than last Thursday's close of 2,888/2,898. "Most banks who have been exerting much of the demand have built sufficient positions by now," said Ahmed Kalule, trader at Bank of Africa. "We might see self-correction as some importers postpone demand."
ZAMBIA: Traders expected the kwacha currency to stay on the back foot on dollar demand by companies seeking to pay dividends to foreign-based investors.
The currency of Africa's second-largest copper producer traded at 6.9850 to the dollar from 6.9600 a week ago. "We could see some tick up in demand for dollars as companies make dividend payments. This could put pressure on the kwacha," one commercial bank trader said.