The Kenyan, Tanzanian and Zambian currencies are likely to strengthen in the coming week while Uganda's shilling is expected to post moderate losses. NAIROBI - The Kenyan shilling is expected to strengthen against the US dollar due to tight liquidity and increased foreign remittances amid flat demand from importers ahead of the holiday season. Commercial banks quoted the shilling at 101.45/65 per dollar, compared with 102.55/75 at last Thursday's close.
"Tight liquidity in the money market is still driving the price... demand has also tailed off and historically at this time of the year we get a lot of inflows from the diaspora," a senior trader from one commercial bank said. TANZANIA - Tanzania's shilling is expected to gain, helped by low US dollar demand due to a slowdown of activity during the holiday season.
Commercial banks quoted the shilling at 2,295/2,305 per dollar, compared with last Thursday's close of 2,306/2,312. "Demand for US dollars is declining every day because of the holiday season. We forecast the shilling to gain more next week to the level of 2,295/2,305," one commercial bank trader said.
ZAMBIA - The kwacha is likely to hold firm against the US dollar in the coming week due to low demand for hard currency during the holiday season.
On Thursday, commercial banks quoted the currency of Africa's second-largest copper producer at 11.8750 per dollar, stronger than a close of 11.9500 a week ago.
The break below the 11.9000 psychological barrier could see it post further gains in the short to medium term, local commercial bank Cavmont said in a note.
UGANDA - The Ugandan shilling is seen weakening moderately next week on the back of expected demand from mainly commercial banks who will be squaring positions ahead of year end.
At 1205 GMT commercial banks quoted the shilling at 3,685/3,695, compared to last Thursday's close of 3,695/3,705. "In the last days of year we normally see heavy activity on the buying side because those who are thin on hard currency want to beef up their positions," said a trader at a leading commercial bank.
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