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AFRICA FX-Ugandan shilling seen firming, other African currencies stable - REUTER

AUGUST 23, 2019

KAMPALA, Aug 22 (Reuters) - The Ugandan shilling is expected to be firmer next week, as other African currencies hold steady.

 

UGANDA

 

At 1022 GMT commercial banks quoted the shilling at 3,685/3,695, compared to last Thursday's close of 3,690/3,700.

"The local unit will have its overall bias on the higher side with most of the support coming from NGO dollar flows," said a trader at a leading commercial bank.

Most NGOs receive their grants in hard currency and have to do conversions for local currency to meet their expenses.

 

NIGERIA

The Nigerian currency is seen stable next week after it hit resistance at 364 naira per dollar following the central bank's increased sale of open market bills, traders said.

Traders said banks were bidding to buy the currency at 363.70 naira on Thursday, firmer than last week's 364 level, after the central bank governor Godwin Emefiele met investors in London last week to discuss the currency. Investors have also curtailed their exit from local debt.

 

TANZANIA

Tanzania's shilling is expected to hold steady next week due to prevailing balance between inflows from agriculture exports and tourism and demand from the energy and manufacturing sectors.

Commercial banks quoted the shilling at 2,294/2,304 on Thursday, slightly lower from the average of 2,293/2,303 recorded last week, a forex trader from one of the commercial banks in Dar es Salaam told Reuters.

"We expect to see more inflows from agriculture exports especially cotton and tourism which matches with importers' U.S. dollar needs mainly from energy and manufacturing sectors," he said.

 

ZAMBIA

The kwacha is expected to continue trading range bound versus the U.S. dollar next week, with demand for hard currency expected to match end of month supply.

On Thursday, commercial banks quoted the currency of Africa's second-largest copper producer at 13.0700 per dollar from a close of 13.0200 a week ago.

"Our view is that the local unit will continue to trade around the current range," the local branch of South Africa'sFirst National Bank (FNB) saud in a note.

 

KENYA

The Kenyan shilling is forecast to hold steady against the dollar in the coming week supported by inflows from offshore investors buying government debt amid some commercial banks cutting their long dollar positions to meet central bank reserve ratio requirements, traders said.

Commercial banks quoted the shilling at 102.95/103.15 per dollar, compared with 103.00/20 at last Thursday's close.

"Its a factor of how banks shoring up local currency will affect liquidity ... and investor interest in government paper," said a trader from one commercial bank.

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