Ghana's and Uganda's currencies are seen ceding ground to the dollar over the next week on the back of a typical seasonal surge in demand while Nigeria's naira is seen holding steady, helped by a central bank intervention.
On Tuesday, Nigeria's central bank sold around $330 million to meet part of a backlog of forex demand by manufacturing firms, while dollar supply from international money transfer agencies has helped ease a shortage at the parallel market.
"We expect the typical shopping season to trigger greater activity on the demand side," said Faisal Bukenya, head of market making at Barclays Bank.
"The slowdown in demand for dollars coupled with increased inflows from cashew nut exports are expected to keep the shilling steady at same levels next week or the local currency could appreciate slightly," said Moses Kawiche, a trader at CRDB Bank.