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WEEKAHEAD-Nigerian naira expected to be stable due to dollar flows
June 1, 2017 / 2:25 PM / 4 months ago

WEEKAHEAD-Nigerian naira expected to be stable due to dollar flows

NAIROBI, June 1 (Reuters) - The Nigerian naira is expected to be stable in the coming week while the Zambian kwacha could come under pressure.

NIGERIA

The Nigerian naira is seen stable across the board in the near term on increased dollar supply to both the official interbank window and the black market.

It has been trading around 382 to the dollar on the black market in the last two weeks, while at the interbank market the naira was trading at around 305.40 per dollar.

The central bank has been intervening on the official market to try to narrow the spread between the official interbank and black markets. It has sold over $4 billion since February, improving dollar supply and providing support for the naira.

KENYA

The Kenyan shilling could gain ground against the dollar in the coming week with dwindling end month importer demand giving way to foreign exchange inflows from charities and exporters, traders said.

At 0850 GMT on Wednesday, commercial banks quoted the shilling at 103.35/45 per dollar, compared with 103.25/45 at last Thursday’s close. Thursday was a public holiday.

“End of month demand is taking it’s course, I expect it to gain maybe slightly,” said a trader from a commercial bank.

ZAMBIA

The Zambian kwacha is likely to come under pressure in the coming week due to increasing demand for dollars from importers at the start of the new month.

At 0740 GMT on Thursday, commercial banks quoted the currency at 9.2500 per dollar, stronger than 9.3300 a week ago.

“Dollar supply continues to wane while demand persists. Higher levels will attract exporters to provide resistance,” one senior commercial bank trader said.

UGANDA

The Ugandan shilling is seen posting marginal gains in the coming week, boosted by flagging appetite for hard currency as commercial banks stay on the sidelines ahead of 2017/18 fiscal year budget reading.

At 1100 GMT, commercial banks quoted the shilling on 3,590/3,600, stronger than last Thursday’s close of 3,600/3,610.

“In the days ahead of the budget players tend to go slow on taking positions and this is what we’re likely to see,” said a trader at a leading commercial bank.

The budget for the next July-June fiscal year is due to be read on June 8.

GHANA

Ghana’s cedi is seen stable next week on expected offshore portfolio inflows on the heels of a three-year local bond and central bank dollar sales, traders said.

The local unit, which has been fairly stable most part of the year, weakened 2.8 percent in the month of May on a mid-month corporate dollar demand surge. It was trading at 4.3275 to the greenback by mid-morning on Thursday, compared with 4.3200 a month ago.

“We see a bullish outlook for the cedi in the days ahead as we expect portfolio inflows and central bank support to offer the currency some stability,” analyst Joseph Biggles Amponsah of Accra-based Dortis Research said.

TANZANIA

The Tanzanian shilling could come under pressure in the coming days due to demand for hard currency from the oil sector. Commercial banks quoted the shilling at 2,238/2,243 to the dollar on Thursday from 2,234/2,244 a week ago. “There is pressure on the local currency coming from the oil sector, despite month-end dollar inflows from corporates. The shilling could trade in a tight range next week,” said a trader at CRDB Bank. (Reporting by Oludare Mayowa, John Ndiso, Chris Mfula, Elias Biryabarema, Kwasi Kpodo and Fumbuka Ng‘wanakilala Editing by Jeremy Gaunt)

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