NAIROBI, July 9 (Reuters) - Kenya's shilling will come under
pressure over the next week, while Tanzania's will likely hold
firm, traders said. Uganda's shilling was seen strengthening,
Zambia's kwacha holding ground and Nigeria's naira weakening.
KENYA
The Kenyan shilling KES= will likely come under pressure
due to increased dollar demand from the energy sector and from
importers as COVID-19 restrictions ease and economic activity
resumes, traders said.
"Being an import-based economy, after the lockdown lifted
... the energy sector and general importers shipping goods into
the country need more dollars," said a senior trader from one
commercial bank.
President Uhuru Kenyatta announced a phased reopening of the
country on Monday. Domestic flights are due to resume on July
15, and international ones from Aug. 1. Commercial banks quoted the shilling at 106.75/95 per dollar
on Thursday, marginally weaker than last Thursday's close.
TANZANIA
Tanzania's shilling TZS= is expected to hold steady due to
the strong support of inflows from exports since the easing of
coronavirus-related restrictions, traders said.
Commercial banks quoted the shilling at 2,312/20 levels
against the greenback on Thursday, unchanged from last week.
"We foresee the Tanzanian shilling remaining steady against
the dollar, supported by dollar supply from exports as we expect
increased activity in trading," said Terry Karanja, a treasury
associate at Nairobi-based forex trading firm AZA.
"We also see neighbouring countries like Kenya, opening
their economies, boosting trade activity between the countries,"
Karanja added.
UGANDA
The Ugandan shilling UGX= is seen strengthening as
appetite for hard currency continues to take a hit from slumping
consumer spending caused by the impact of the coronavirus,
traders said.
At 0934GMT on Thursday, commercial banks quoted the shilling
at 3,705/3,715, compared with last Thursday's close of
3,720/3,730.
"(Dollar) appetite by importers has really plummeted and we
know that's connected to the general slump in consumer demand,"
said an independent foreign exchange trader in the capital
Kampala.
He said the shilling would probably strengthen below the key
psychological level of 3,700 in the coming week as importer
demand continues to drop.
NIGERIA
Nigeria's naira NGN= is expected to trade at the weaker
rate after the central bank this week unified its multiple
exchange rates in a bid to ease dollar shortages that have
plagued the country for months, traders said.
The naira was quoted at 381 on the official market on
Wednesday after it lost 5.5% from its previous rate to trade
close to the over-the-counter spot market, widely used by
investors and importers.
The central bank has been under pressure from the World Bank
and the International Monetary Fund to carry out currency
reforms in order to qualify for budget-support loans, and from
the Nigerian government to get more naira for its crude oil
receipts.
"They merged FX rates not the different trading windows,"
one trader said, adding that he thought the central bank needed
to allow the currency to trade freely.
"I don't think liquidity will return in the short term. The
general macros need to change for that to happen."
ZAMBIA
The Zambian kwacha ZMW= is likely to hold firm against the
dollar next week as declining imports limit demand for hard
currency.
On Thursday, commercial banks quoted the currency of
Africa's second-largest copper producer at 18.0500 per dollar
from a close of 17.9500 a week earlier.
"It should hold within the current levels due to minimal
trade because of COVID-19 restrictions," independent financial
analyst Maambo Hamaundu said.