LAGOS, Dec 17 (Reuters) - Nigeria's naira and other African
currencies are likely to trade stable or firm slightly in the
week ahead, helped by Diaspora inflows and waning appetite for
hard currency as some firms wind down activity ahead of
Christmas holidays.
NIGERIA
The naira NGN= is seen flat across markets next week after
money transfer operators started to pay out dollars to
beneficiaries of Diaspora remittances following the central
bank's easing of restrictions.
The naira traded at 476 per dollar on Thursday on the black
market, where it trades more freely, a level it was quoted at a
week earlier.
The currency was quoted at 381 per dollar on the official
market, a level set by the central bank in July. The naira sold
at 391.78 on the over-the-counter spot market NAFEX=FMDQ ,
quoted by investors and importers, in thin trade.
Last week, Nigerian banks started to pay out dollars for
Diaspora inflows and closed naira remittance accounts after the
regulator eased money transfer rules to try to boost forex
liquidity in the country.
The Kenyan shilling KES= is seen firming moderately, due to
low dollar demand as most companies start closing ahead of the
festive season.
At 1150GMT on Thursday the shilling was quoted at
111.50/111.65, compared with 111.45/111.65 at the end of trading
a week earlier.
"Next week, I think because many companies are closing down,
there won't be much activity in the market and so we may see the
Kenyan shilling strengthen just a little bit,” said a trader at
one commercial bank.
UGANDA
The Ugandan shilling UGX= is seen trading in a stable range
amid slowing appetite for hard currency from firms in major
sectors like manufacturing and others.
At 1139GMT commercial banks quoted the shilling at
3,660/3,670, compared to last Thursday's close of 3,670/3,680.
A trader at one of the leading commercial banks said
appetite for hard currency was slowing down especially among
manufacturing, telecoms, energy and other sectors as they
prepare to break off for year-end holidays.
"Demand is fizzling out and considering that, I see the
local unit holding steady," he said, adding the shilling will
likely oscillate in the 3,650-3,670 range.
TANZANIA
The Tanzanian shilling TZS= is also expected to broadly hold
steady next week as pressure to the local currency decreases due
to slow business activities ahead of holiday season.
Commercial banks quoted the shilling at 2,314/24 on
Thursday, the same level recorded a week earlier.
"We are expecting the shilling to stabilise and tourism will
contribute slightly on inflows which will match the current
demand of US dollars in the market," a trader at one of the
commercial banks in Dar es Salaam said.
ZAMBIA
The kwacha ZMW= is expected to remain under pressure against
the dollar next week as demand for hard currency continues to
outweigh supply.
On Thursday, commercial banks quoted the currency of
Africa's second largest copper producer at 21.0700 per dollar
from 21.0450 at the close of business a week ago.
"Dollar demand remains higher than supply and this should
continue putting pressure on the local currency going into next
week," one commercial bank trader said.