African currencies outlook

The Ugandan shilling could come under pressure next week when business resumes after a strike by traders and shopkeepers in the capital Kampala ends. In Tanzania, the shilling is expected to remain stable, helped by inflows from foreigners who sold dollars to buy shares in Tanzania Breweries Limited.
UGANDA Uganda's shilling is forecast to be rangebound but could weaken as greenback demand picks up again after a strike by traders in the capital Kampala ends. Traders and shopkeepers in the capital of east Africa's third largest economy shut their businesses on Wednesday for a three-day strike to press commercial banks to stop raising interest rates. The shilling would oscillate in the 2,400-2,460 range over the next one week said Peter Mboowa, a Treasury dealer at KCB Uganda.
TANZANIA Tanzania's shilling is seen holding firm, helped by foreigners who sold dollars to buy a stake in Tanzania Breweries Limited (TBL) after the placement of the company's shares on the Dar es Salaam Stock Exchange. Commercial banks in Dar es Salaam quoted the shilling at 1,578/1,588 to the dollar at Wednesday's close, stronger than last Thursday's close of 1,585/1,595.
"If the central bank continues to intervene in the market by selling dollars to oil importers and implementing tight monetary policy measures, the shilling should remain stable in the week ahead," said Siwali. Traders said they expect the shilling to trade in the 1,570-1,580 range in the coming days.
KENYA Kenya's shilling is seen on the back foot against the dollar in the coming days, pressured by corporate and interbank demand for hard currency, but traders expect central bank intervention to tame a steep fall in the local currency. Traders also said the decision by the bank's Monetary Policy Committee to leave its key lending rate unchanged at 18 percent on Wednesday, had already been factored in the money markets.
The central bank has intervened to defend the shilling anytime it approaches 88 against the dollar by mopping up excess liquidity and pumping hard currency into the market, traders said. Traders forecast the shilling would trade in the 87-88 range in the week ahead.
GHANA The cedi is expected to inch up against the dollar in the coming week provided the central bank continues to support the currency, traders said. The cedi fluctuated during the first hour of trade on Thursday. Opening at 1.6950/75, it dropped down to 1.6890/95 1.6920/45. The central bank supplied the market with 75 million dollars on Thursday morning, Collins Antwi, deputy treasurer at the Bank of Ghana, said. Antwi said currency fluctuations were a seasonal issue and the bank was monitoring the market closely.