The naira, shilling, and kwacha of Nigeria, Kenya, and Zambia are anticipated to face significant pressure in the next week to Thursday, although the cedi of Ghana and the shilling of Uganda are likely to remain stable, according to merchants. Reuters released a story on Thursday.
Kenya
Before the year ends, it is anticipated that demand for foreign currencies will increase across all sectors, which would cause the Kenyan shilling to continue its slow decline.
The shilling was quoted by commercial banks at 152.70/90 per US dollar, down from its closing rate of 152.20/40 on Thursday. According to LSEG data, the shilling fell to a new all-time low of 152.75/95 on Thursday.
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Nigeria
The naira is expected to weaken on the black market since the central bank of Nigeria has not yet settled outstanding foreign-currency debt from forward trades.
Corporates in Nigeria purchased approximately $7 billion worth of maturing foreign exchange forwards from local banks.
On Thursday, the naira traded freely for 1,160 to the dollar on the open market, down from 1,130 naira a week earlier. Following a dip as low as 1,051 naira in early trade, the unit traded at about 800 naira per dollar in official trading on Thursday afternoon.
“I anticipate that the parallel market exchange rates will be in the range of 1,160 and 1,200 naira the following week,” a trader stated. “We anticipated that the central bank would settle outstanding forwards, but they only made small, fragmented payments.”
Ghana
The anticipated FX inflows from a syndicated loan on cocoa are projected to keep Ghana’s cedi stable next week, according to traders.
By the end of the month, banks and Ghana’s cocoa marketing body COCOBOD intend to conclude a $800 million syndicated loan.
According to LSEG data, the cedi was trading at 11.9000 to the dollar on Thursday, down from 11.9000 at the close of last Thursday.
Sedem Dornoo, a senior trader at Absa Bank Ghana, stated, “We expect it to be relatively stable in the coming week, following news that COCOBOD has completed the highly anticipated $800 million syndicated loan.”
He continued, “We anticipate that the pair will stay range bound for the remainder of the year.”
Uganda
Remittance inflows of hard cash are supporting the consistent range in which the Ugandan shilling is trading.
The shilling was quoted by commercial banks at 3,785/3,795 to the dollar as opposed to the close of 3,775/3,785 last Thursday.
An independent foreign exchange broker in Kampala, the country’s capital, stated, “We have been seeing substantial amounts of (dollar) inflows from remittances coming in which I think will continue to provide support well into mid December.”
He predicted that in the upcoming days, the shilling would probably fluctuate between 3,750 and 3,790.
Zambia
Zambia’s kwacha is expected to continue to face mild pressure due to the market’s persistently high demand and muted foreign exchange supplies.
Based on LSEG statistics, the currency was trading at 23.3500 to the dollar on Thursday, down from 23.0695 at the end of the previous week.
The kwacha was negatively impacted by delays in the debt restructuring of the nation, according to Bank of Zambia Governor Denny Kalyalya, who made this announcement on Wednesday.
