LAGOS Dec 15 Nigeria's naira and some other
African currencies are expected to stay broadly stable over the
coming week as the tempo of business slows ahead of Christmas
festivities but Ghana's cedi could strengthen, helped by flows
from commodity sles.
The naira is expected to remain firm at both the
official interbank rate and on parallel markets ahead of the
festive season as businesses wind down activities and demand for
hard currency slows.
The naira has traded steady this week at 485 to the dollar
on the parallel market as demand for the greenback waned.
"There should be little pressure in the currency market in
the coming days because many businesses are already winding down
their operations," a currency changer told Reuters.
Nigerians living abroad who will be visiting home for the
holidays are also expected to bring in hard currency inflows and
offer extra support to the naira.
Ghana's cedi is seen being underpinned by foreign
exchange supplies from cocoa sales.
The currency stabilised this week after a streak of losses
ahead of a presidential election on Dec.7, won by opposition
leader Nana Akufo-Addo.
At 1030 GMT the cedi was quoted at 4.14 to the dollar,
compared with 4.22 a week ago.
Analyst Joseph Biggles Amponsah of the Accra-based Dortis
Research said the cedi would "extend its gains in the coming
week to trade below 4.1000 and towards the 4.0000 levels".
Tanzania's shilling is seen appreciating slightly due to a
slowdown in demand for hard currency from importers while
players are expecting some inflows from the agricultural sector
and big firms converting some of their hard currency holdings.
Commercial banks quoted the shilling at 2,178/2,183 to the
dollar on Thursday, barely moved from 2,174/2,184 a week ago.
"There is a big demand for shillings at the moment as
corporates are selling dollars to meet payment obligations in
local currency," said a dealer at a commercial bank.
The Kenyan shilling could lose ground due to importer
demand and spillover negative sentiment after the U.S. Federal
Reserve raised rates, traders said.
At 1145 GMT, commercial banks quoted the shilling at
102.00/102.10 to the dollar, little changed from last Thursday's
close of 101.95/102.15.
"We are likely to see emerging market currencies, Kenya
being one of them trading lower (weaker) against the dollar,"
said a trader from a commercial bank.
The Uganda shilling is forecast to trade with a firming
bias, helped by a large mop-up of excess local currency
liquidity by the central bank.
At 1214 GMT commercial banks quoted the shilling at
3,600/3,610, stable from last Thursday's close.
Bank of Uganda, the central bank, removed a total of 831
billion shillings ($230.51 million) from the interbank market
via a 7-day repo.
"I see the local unit playing in a stable range but probably
inclined toward the strengthening side," said a trader from a
leading commercial bank who added the mop-up would trim appetite
for the greenback among banks.
The kwacha will likely trade in a stable position on
the back of ebbing demand for hard currency as most firms start
to close or cutback business ahead of the Christmas and year-end
At 0948 GMT, commercial banks quoted the kwacha at 9.8900
per dollar from a close of 9.8400 a week ago, according to
Thomson Reuters data.
"Activity in the market has slowed. The kwacha has traded in
the 9.850/9.900 range over the past few weeks and should remain
in the current range as we go into 2017," the Zambian branch of
South Africa's First National Bank (FNB) said in a note.
($1 = 3,605.0000 Ugandan shillings)
(Reporting by Kwasi Kpodo; Elias Biryabarema; John Ndiso; Chris
Mfula; Fumbuka Ng'wanakilala and Oludare Mayowa. Compiled by
Elias Biryabarema; editing by Jeremy Gaunt)