Nigeria’s naira is expected to strengthen a little in the coming days at the black market as the central bank increase dollar supply to the interbank forex market in a bid stave off pressure on the local currency.
The naira firmed to 457 to the dollar on the black market on Thursday, better than 465 a dollar last week as international money transfer organisation, Travelex sell more dollar to currency retailer; bureaux de change while the central bank increased dollar supply to meet the hard currency needs of private individuals at the official window.
Commercial lenders quoted the naira at 314 to the dollar on the official interbank market, but seen closing around 306 a dollar after the regular central bank dollar sales.
Nigeria’s central bank plans to offer $100 million in currency forwards on Thursday to be settled within 60 days, while Travelex will sell about $20 million to 3,124 bureau de change, boosting dollar supply and support for the local currency.
Ghana’s cedi is expected to continue its rally next week to recoup all its recent losses against the dollar on improved forex inflows as first quarter import demand pressures on the currency eases, analysts said.
After touching record lows of 4.7420 to the dollar early this month, the cedi has steadily regrouped, rallying to 4.5600 by mid-morning on Thursday compared to 4.6750 a week ago. It is down around 8 percent since January, according to Reuters data.
“The cedi’s (rallying) momentum appears not to be waning any time soon and we could see it recover its losses further against the dollar in the face of improved forex liquidity and a somewhat dwindling demand,” Joseph Biggles Amponsah, analyst at the Accra-based Dortis Research said.
The Zambian kwacha is expected to come under pressure next week due to reduced supply of dollars in the absence of any tax payments and sale of government securities.
At 0700 GMT on Thursday, commercial banks quoted the currency of Africa’s No.2 copper producer at 9.4800 per dollar, marginally firmer than 9.5000 a week earlier.
“It will probably lose a bit of ground because there is no event that should help improve dollar supply,” Maambo Hamaundu, an independent financial analyst said.
The Kenyan shilling is expected to weaken against the dollar in the coming week due to increased oil importer dollar.
At 0839 GMT, commercial banks quoted the shilling at 103.05/15 to the dollar, compared with 102.45/65 at last Thursday’s close.
“The CBK decided to recall the last auction… this action starved the local market of the much needed dollar inflows,” said a trader from a commercial bank.
The Ugandan shilling is seen trading in a firmer position on helped by a central bank mop up of excess liquidity.
At 0843 GMT commercial banks quoted the shilling at 3,590/3,600, from last Thursday’s close of 3,595/3,605.
“The mop-ups of this excess liquidity will keep the shilling oscillating around 3,600 psychological level,” said a trader at a leading commercial bank.
The Tanzanian shilling is expected to remain unchanged in the days ahead, supported by low dollar demand and subdued inflows.
Commercial banks quoted the shilling at 2,235/2,240 to the dollar on Thursday, little moved from 2,230/2,240 a week ago.
“No changes are expected next week because there is still a lack of activity in the market. Things are pretty quiet,” said a trader at a commercial bank.