African currencies week ahead: Nigerian, Zambian, Kenyan currencies seen under pressure
LUSAKA: Nigerian, Zambian and Kenyan currencies are expected to weaken again next week against the US dollar. Tanzania and Uganda’s should hold steady.
NIGERIA — The naira is seen easing on the spot market after it fell 0.21% to 410.29 per dollar on Thursday, as dealers await the result of a central bank Treasury bill auction to gauge the level of foreign currency liquidity, traders said.
The currency has been losing ground on the spot market on thin liquidity, with the naira touching record intra-day lows this month and mirroring rates on the futures market, which serves as a benchmark for fund flows into Nigeria. The naira was quoted at 381 naira on the official market, a level set in July and backed by the central bank. It sold at 480 naira on the black market on Thursday.
ZAMBIA — The kwacha is likely to face continued pressure against the dollar going into next week due to heightened demand for hard currency amid limited inflows. On Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 21.7300 per dollar, down from a close of 21.6050 a week ago.
KENYA — Kenya’s shilling is likely to remain on the defensive next week as end-of-month dollar demand from the energy sector spills over into the beginning of March, traders said. Commercial banks quoted the shilling at 109.70/90 to the dollar, compared with last Thursday’s close of 109.45/65.
TANZANIA — Tanzania’s shilling is expected to hold steady next week as demand for the US dollar from importers is projected to match inflows from investors and international lenders.
Commercial banks quoted the shilling at an average of 2,305/2,310 on Thursday, up from 2,311/2,329 recorded a week earlier. Tanzania secured a $50 million loan from OFID to finance anti-poverty initiatives, the body announced on Friday.
UGANDA — The Ugandan shilling is seen trading in a stable range in the coming days supported by typical end-of-month inflows from exporters of commodities like coffee and others. At 1029 GMT commercial banks quoted the shilling at 3,660/3,670, unchanged from last Thursday’s close.
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