East African currencies are seen in mixed trading in the week to Wednesday with the Kenya shilling expected to receive a boost by foreign investment chasing Treasury paper, dealers said.
KENYA The Kenya shilling may be supported by demand for the local currency by foreign investors buying government paper in coming days, dealers said. The commercial banks posted the unit at 76.70/80 per greenback, a little stronger than an intraday low of 76.80/90, but weaker than the 76.15/25 at the close of Wednesday's trade last week. This week, we are seeing a lot more activity," said Mwambu Malamba, a trader at Commercial Bank of Africa.
He said oil importers were converting shillings to buy fuel for electricity generators. Drought in Kenya has depleted hydro-dams, the main source of power, and led to water and electricity shortages. Food importers are also bringing in provisions to meet a shortfall.
Central Bank of Kenya had not bought foreign exchange from the market in the week to Wednesday, dealers said. The bank will auction its first 364-day Treasury bill on Thursday, worth 8 billion shillings, and has invited tenders for 5-year bond.
TANZANIA The Tanzania shilling is seen holding steady and possibly firming slightly in the week ahead boosted by dollars sales from the agriculture sector and central bank. Commercial banks quoted the shilling at 1,329/1,334 to the dollar, compared with last Wednesday's close of 1,322/1,327.
Dealers said they expect it to trade in the 1,320-1,335 range in coming days. "We actually see that as long as there are inflows from agriculture we see the shilling stabilising around 1,320/1,330," said Frank Ndugulile, a dealer at CRDB Bank. Other dealers see the local unit holding steady.
UGANDA Uganda's shilling is forecast to trade in a wide range against the US currency in the coming days, driven by dollar sales and interbank demand, dealers said. Commercial banks in Kampala quoted the unit at 2,090/2,100 to the dollar compared to 2,090/2,098 a week ago. It is expected to trade within 2,050/2,100 range in the coming days.
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