WEEKAHEAD-AFRICA-FX-Kenyan, Ugandan currencies seen firmer, Nigeria's weaker

Published 07/05/2020, 13:48
Updated 07/05/2020, 13:54
© Reuters.
USD/KES
-
USD/TZS
-
USD/UGX
-
USD/ZMK
-

NAIROBI, May 7 (Reuters) - Kenyan and Ugandan currencies are
likely to firm next week as Nigeria's comes under pressure and
Zambia and Tanzania's hold steady.

KENYA
The Kenyan shilling KES= is expected to strengthen due to
inflows from the diaspora and an emergency International
Monetary Fund (IMF) loan to support the economy against the
impact of the novel coronavirus outbreak, traders said.
Commercial banks quoted the shilling at 106.00/20 per U.S.
dollar, compared with 107.20/40 at last Thursday's close.
"We know that there is support coming in (from the IMF)
because of COVID-19, it would help boost reserves...we expect
diaspora remittances and horticulture to pick up as countries
ease lock-down measures," said a senior trader from one
commercial bank.

UGANDA
The Ugandan shilling UGX= is expected to firm after the
IMF on Wednesday approved a $491 million emergency loan to help
Uganda with the economic fallout from the novel coronavirus.
Commercial banks quoted the shilling at 3,795/3,805,
compared to last Thursday's close of 3,815/3,825.
"The loan is welcome news for the markets ... there might be
some lag before it's disbursed but I expect an immediate
positive sentiment that will support the shilling," said one
trader from a commercial bank.

NIGERIA
Nigeria's naira NGNFX=BDCN is seen easing next week after
the central bank weakened the currency on the futures market
offered mostly to foreign investors, traders said.
The naira, however, firmed on the over-the-counter spot and
black markets this week after the central bank resumed dollar
sales to help individuals with dollar expenses abroad and
importers resume economic activities following a phased easing
of a coronavirus lockdown.
But the bank is yet to sell dollars to foreign investors
seeking to exit naira assets, with traders putting a backlog of
demand at between $1.5 billion to $1.8 billion.
The currency was quoted at 386.93 naira per dollar on the
spot market, mostly used by foreign investors and exporters.

ZAMBIA
The kwacha ZMW= is likely to remain range-bound against
the U.S. dollar next week with minimal market activity as the
impact of COVID-19 hits production.
On Thursday, commercial banks quoted the currency of
Africa's second-largest copper producer at 18.3630 per dollar
from 18.5760 at the close of business a week ago.
"It should remain within the 18-18.5 range per dollar. Some
companies have closed and this has a bearing on the kwacha,"
independent financial analyst Maambo Hamaundu said.

TANZANIA
Tanzania's shilling TZS= is also expected to hold steady
next week, traders said.
Commercial banks quoted the shilling at 2,309/19 on
Thursday, the same levels as a week earlier.
"It is highly likely the shilling will remain stable next
week. The demand and supply of dollars will almost match," a
trader in a commercial bank said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2024 - Fusion Media Limited. All Rights Reserved.