October 4, 2018 / 2:01 PM / 13 days ago

UPDATE 1-AFRICA-FX-Ghana's cedi to hold ground while Zambia's Kwacha could strengthen

(Adds Nigerian naira)

ACCRA, Oct 4 (Reuters) - Ghana’s cedi and Zambia’s kwacha are seen holding their ground or moving toward the stronger side over the next week, lifted by local tax payments.

GHANA

Ghana’s cedi could hold its own against the dollar on the back of hard currency inflows from a $1.3 billion cocoa loan that is expected to boost the central bank’s interbank support capacity, analysts said.

The cedi, which had been under pressure for weeks mainly due to global factors, recouped some of its losses this week. It was trading at 4.9500 to the greenback compared with 4.9850 a week ago.

In the fourth quarter the cedi is expected to remain fairly stable “as forex liquidity improves on the back of inflows from cocoa loans,” said currency analyst Joseph Biggles Amponsah.

“(Dollar) demand is also not expected to be as strong in the early weeks of (the quarter)

ZAMBIA

The Kwacha is expected to remain firm next week as dollar supply from companies that will be paying taxes continues to outweigh demand in the market.

On Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 11.4000 per dollar, far stronger than a close of 12.3750 a week ago.

“Current trends seem to indicate that the local unit is poised for further gains should supply continue to outweigh demand,” a local commercial bank, Cavmont, said in a note.

KENYA

The Kenyan shilling is expected to remain stable in the coming week due to thin importer and corporate dollar demand meeting with some inflows from the horticulture and tourism sectors.

At 0925 GMT, commercial banks quoted the shilling at 100.90/101.00 per dollar, the same level as last Thursday’s close.

A trader at a leading commercial bank said the shilling would trade stable because appetite for hard currency was “at the moment... a bit quiet,” while inflows from tourists and exporters of flowers were offering support.

UGANDA

The Ugandan shilling is seen trading with a broadly strengthening tone after the central bank hiked its benchmark lending rate amid worries over inflationary pressures.

At 1009 GMT commercial banks quoted the shilling at 3,770/3,780, compared to last Thursday’s close of 3,815/3,825.

A trader at a leading commercial bank said he anticipated the shilling to “benefit from the impact of the rate decision.”

Bank of Uganda this week raised its policy rate by 100 basis points to 10 percent as policymakers cited worries over growing inflationary pressures. The trader said the shilling would oscillate between 3,760-3,800 over the next week.

NIGERIA

Nigeria’s naira is seen stable next week as traders resist weaker quotes on the currency after the unit fell below 364 to the dollar for investors last week due to tight liquidity, traders said.

The naira has weakened in recent months due to thin dollar liquidity in the wake of low foreign investor interest for local assets and declining foreign reserves.

Traders said liquidity had improved this week with lenders quoting to sell dollars at 364, which is expected to continue next week, as importers put off demand for hard currency at weaker levels. (Reporting by Chris Mfula, John Ndiso, Kwasi Kpodo, Elias Biryabarema and Chijioke Ohuocha; Compiled by Elias Biryabarema)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below