DAR ES SALAAM, Dec 21 (Reuters) - The Tanzanian shilling and Ghana’s cedi will likely firm next week, while the Ugandan shilling is seen trading with a bearish tone.
The Tanzanian shilling is likely to strengthen helped by hard currency inflows from the agriculture sector and a slowdown in business activity towards the year-end festive season.
Commercial banks quoted the shilling at 2,238/2,243 to the dollar on Thursday, stronger than 2,240/2,244 a week ago.
“The shilling has been strengthening on the back of ongoing export earnings from cashew nuts and subdued demand for dollars from importers. We expect the local currency to remain firm next week,” said a trader at Commercial Bank of Africa Tanzania.
Ghana’s cedi is expected to remain strong against the greenback on lower demand for dollars and improved supply from corporates, traders said.
At 1113 GMT on Thursday, Reuters data showed the local unit quoted at 4.5100 per dollar, almost the same as 4.5000 at which it closed a week ago.
“Demand (for dollars) seems ebbed and we expect the cedi to remain relatively strong versus the United States dollar for the rest of year,” one trader said.
The Ugandan shilling is seen trading with a depreciating tone, undercut by demand mostly by commercial banks as they look to square their positions ahead of year close.
At 0927 GMT commercial banks quoted the shilling at 3,610/3,620, compared to last Thursday’s close of 3,615/3,625.
“Most banks will be picking up dollars to cover where they are short in the remaining days of the month,” said Faisal Bukenya, head of Treasury at Exim Bank.
The Kenyan shilling is expected to remain stable in the coming week with money markets closed for two sessions on Monday and Tuesday due to Christmas and Boxing Day holidays, traders said.
On Thursday, commercial banks quoted the shilling at 102/95/103.05 per dollar, compared with 103.05/15 at last Thursday’s close.
“We see the currency pair holding in the same range and resuming trade at pre-christmas levels,” said a trader from a commercial bank.
The kwacha is expected to trade flat against the green currency next week due to limited market activity and weak demand for dollars ahead of Christmas.
At 1028 GMT on Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 9.7500 per dollar, where it closed a week ago.
“The local currency is likely to remain range bound owing to weak demand from most corporates who have gone on an industrial break,” Cavmont Bank said in a note, referring to demand for dollars. (Reporting by Fumbuka Ng‘wanakilala, Christian Akorlie, Elias Biryabarema, John Ndiso, Chris Mfula; Compiled by Chris Mfula; Editing by Willia Maclean)