Zambia's kwacha is expected to maintain its downward trend next week although another under-pressure African currency, Ghana's cedi, may find support from traders expecting inflows of dollars from cocoa and Eurobond loans.
ZAMBIA: The kwacha is likely to remain bearish versus the dollar next week due to limited supply of greenbacks coming in to Africa's second largest copper producer. At 1112 GMT, the kwacha was being bid at 10.0000 per dollar, weaker than last week's 9.8500 close. Its record low is 10.24 from September 9. "There is no supply of dollars and sentiment also remains poor with mining houses scaling down production and talk of lay offs," one commercial bank trader said.
GHANA: Ghana's cedi could hold its ground against the dollar in coming weeks on expected hard currency inflows from cocoa and Eurobond loans this month. The local unit has been fairly stable this week after a persistent weakening in recent months. It traded at 3.9000 at 1100 GMT on Thursday compared to 3.9500 a week ago.
Cocobod, the cocoa industry regulator, is due to sign a $1.8 billion loan in Paris for the 2015/16 crop purchases. Ghana also plans to issue a fourth Eurobond of up to $1.5 billion in late September for debt restructuring and budget financing. "We expect this stability to continue this week and into next week on the expected inflows, leading to the much anticipated cedi gains," Dortis Research analyst Joseph Biggles Amponsah said.
KENYA: The shilling is seen weakening due to importer dollar demand, but will be cushioned by tight liquidity and prospects of the central bank selling more dollars. Commercial banks quoted the shilling at 105.80/106.00 to the dollar, compared with last Thursday's close of 105.40/50.
"As we go more towards the end of the month, the demand will pick up, and I think the 106 level has to be breached. I feel the trend remains for a weaker shilling, though central bank intervention will slow the process," a senior trader at one commercial bank said.
UGANDA: The shilling is forecast to trade in a stable range over the next one week amidst a slump in demand from corporate clients. At 0940 GMT commercial banks quoted the shilling at 3,650/3,660, stronger than last Thursday's close of 3,660/3,670.
"Appetite from importers and other corporate clients remains substantially low. I don't see that trend changing," said Faisal Bukenya, head of market making at Barclays Bank.
The shilling was likely to oscillate between 3,645-3,680 over the next week but with a stronger bias. Traders say demand for dollars from importers has been low because some are unwilling to buy above 3,650 to the greenback.
TANZANIA: The shilling is likely to strengthen against the dollar, buoyed by increased dollar sales by the central bank and demand for the local currency from corporates for tax and salary payments. Commercial banks quoted the shilling at 2,175/2,185 to the dollar on Thursday, weaker than 2,160/2,170 a week ago.
"The shilling is expected to gain ground against the dollar next week as we approach the end of the month and the end of the third quarter," said Theopistar Mnale, a dealer at TIB Development Bank.
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