African currencies week ahead: Kenyan shilling to firm, Ghana cedi to hold stable

Kenya's shilling is expected to gain ground against the dollar in the week to next Thursday, while Zambia's kwacha is forecast to weaken, traders said.
KENYA - The Kenyan shilling is expected to remain firm against the dollar supported by tight liquidity in the money market and offshore investor inflows, traders said. Commercial banks quoted the shilling at 100.35/55 per dollar, compared with 100.35/35 at last Thursday's close. "We saw some tightness in the money markets but the regulator injected Kenyan shillings, they said liquidity was skewed," said a trader from a commercial bank.
UGANDA - The Ugandan shilling is seen strengthening in the coming days on the back of hard currency inflows from charities, commodity exporters and offshore investors. Commercial banks quoted the shilling at 3,663/3,673, stronger than last Thursday's close of 3,690/3,700. Benon Okwenje said the currency was likely to oscillate between 3,655-85 against the dollar, helped by hard currency inflows "from a range of sources including NGOs (non-governmental organisations), commodities and portfolio flows". Uganda's foreign exchange earnings from commodities mostly come from coffee.
GHANA - Ghana's cedi is expected to hold steady, supported by dollar sales by the central bank while investors assess the impact of last week's consolidation of five failed local banks by the regulator. The cedi was trading at 4.81 to the dollar by mid-morning on Thursday, compared to 4.80 a week ago. "Amid the massive consolidations of local banks last week, the cedi's immediate trajectory is expected to be flat, at least, until market participants and long-term investors assimilate the exact weight and impact will have on their portfolios," analyst Joseph Biggles Amponsah said.
NIGERIA - Nigeria's naira is seen trading within its current range of 362 to 363 next week, supported by dollar inflows from exporters, traders said. Last week, the naira was quoted as weak as 364 per dollar for investors after liquidity thinned out. One trader said dollar supply had improved but there was still ample demand, owing to Nigeria's reliance on imports. On the official market, supported by the central bank, the unit weakened slightly to 306.50.
ZAMBIA - The kwacha is likely to come under pressure due to renewed demand for hard currency from importers. On Thursday, commercial banks quoted the currency of Africa's No.2 copper producer at 9.9200 per dollar, the level at which it closed a week ago. "A continued increase in demand for the greenback in the midst of waning dollar supply may see the local unit depreciate further," the local branch of South Africa's First National Bank (FNB) said in a note.