LUSAKA, April 8 (Reuters) - Zambia's currency is likely to
continue weakening against the U.S. dollar next week while
Uganda's gains. Kenyan, Nigerian and Tanzanian currencies are
expected to hold steady.
ZAMBIA
The kwacha ZMW= may come under renewed pressure against
the dollar next week due to increasing demand for hard currency
as business activity heightens after the Easter holidays.
On Thursday, commercial banks quoted the currency of
Africa's second largest copper producer at 22.1100 per dollar,
marginally down from 22.0750 at the close last Thursday.
"In the absence of central bank intervention, the kwacha
will likely continue depreciating," one commercial bank trader
said.
Zambia's central bank last week injected $12 million into
the economy, thus slowing the kwacha's depreciation, Zambia
National Commercial Bank (ZANACO) said in a weekly note.
UGANDA
The Ugandan shilling UGX= is seen trading with a firming
tone on the back of conversions by offshore investors exiting
Ugandan assets and weak importer demand.
At 1005 GMT commercial banks quoted the shilling at
3,645/3,655, compared to last Thursday's close of 3,660/3,670.
"We have seen consistent offshore investor selling in last
few days and we anticipate the same in the short term," said an
independent FX trader, who explained that the offshore investors
were exiting Ugandan assets like government securities.
Importer demand, he said, is also seen largely remaining
lacklustre due to weak consumer spending.
KENYA
The Kenyan shilling KES= is expected to take a pause in
the week ahead after gaining ground rapidly in the previous two
weeks.
At 1030 GMT on Thursday, commercial banks posted the
shilling at 107.90/108.10 per dollar, having leapt from
109.20/40 the previous week.
The surge in the currency has been driven by dollar inflows
from investors abroad into the local government debt market, and
positive sentiment following the approval of a new financing
package by the International Monetary Fund.
"It will either stabilise or start losing ground. If I were
a buyer I would pick (dollars) at these level because there is a
limit to how much it can strengthen in a short period," said a
trader at a commercial bank.
NIGERIA
The naira NGN=D1 is seen unchanged next week as the
central bank maintains its grip on the currency and dollar
scarcity blights the spot and black markets, traders said.
Dollar shortages have plagued Nigeria as COVID-19 weakened
oil prices. The central bank has maintained a currency regime
that has created multiple quotes on the naira and deterred
foreign investment.
The currency was quoted at 485 per dollar on the black
market NGNFX=BDCN on Thursday, a level it has been stuck at
since this month.
It traded within a range of 407 to 410 naira on the spot
market NAFEX=FMDQ but remained flat on the official market
backed by the central bank at 381 naira since last July.
TANZANIA
Tanzania's shilling TZS= is expected to hold steady next
week and may gain more in the short to medium term as the new
president pushes to improve the business environment.
Commercial banks quoted the shilling at 2,314/2,324 on
Thursday, the same levels as last week's close.
"Demand will continue to be driven by manufacturing and
energy importers while the inflows are expected to be from
normal daily retail activities," one commercial bank trader
said.