AFRICA-FX-Nigerian, Kenyan and Zambian currencies seen under pressure

Man counts Nigerian naira notes in a market place in Yola

A man counts Nigerian naira notes in a market place in Yola, Nigeria, February 22, 2023. REUTERS/Esa Alexander/File Photo Acquire Licensing Rights

Nov 23 (Reuters) – Nigeria’s naira, Kenya’s shilling and Zambia’s kwacha are expected to be under pressure in the next week to Thursday, while Ghana’s cedi and Uganda’s shilling will probably be stable, traders said.


Kenya’s shilling is expected to extend its gradual march lower as foreign-currency demand ramps up from all sectors before the end of the year.

Commercial banks quoted the shilling at 152.70/90 per U.S. dollar, compared with last Thursday’s closing rate of 152.20/40. The shilling hit a new record low on Thursday of 152.75/95, LSEG data showed.


Nigeria’s naira will likely lose ground on the parallel market , as the central bank is yet to clear outstanding foreign-currency amounts owed in forward deals.

Nigeria has nearly $7 billion in forex forwards that have matured and which corporates bought from local banks.

The naira sold for 1,160 to the dollar in street trading where it trades freely on Thursday, weaker than 1,130 naira a week ago. The unit traded around 800 naira per dollar in official trading on Thursday afternoon , after falling as low as 1,051 naira in early trade.

“I expect (exchange) rates to hover between 1,160 naira and 1,200 naira on the parallel market next week,” one trader said. “We had expected that the central bank will pay off outstanding forwards … (but) they paid little in bits.”


Ghana’s cedi is forecast to remain stable next week due to expected forex inflows from a cocoa syndicated loan, traders said.

Ghana’s cocoa marketing board COCOBOD plans to finalise an $800 million syndicated loan with banks by the end of the month.

On Thursday the cedi was trading at 11.9000 to the dollar, compared to 11.9000 at last Thursday’s close, LSEG data showed.

“We expect it to be relatively stable in the coming week, following news that COCOBOD has completed the highly anticipated $800 million syndicated loan,” said Sedem Dornoo, a senior trader at Absa Bank Ghana.

“We expect the pair to remain range bound for the remainder of the year,” he added.


The Ugandan shilling is seen trading in a stable range with inflows of hard-currency from remittances helping lend support.

Commercial banks quoted the shilling at 3,785/3,795 to the dollar, compared to last Thursday’s close of 3,775/3,785.

“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,” said an independent foreign exchange trader in the capital Kampala.

He said the shilling was likely to oscillate in the 3,750-3,790 range in the coming days.


Zambia’s kwacha is likely to remain under modest pressure as the market continues to experience subdued foreign-exchange supply and high demand.

On Thursday, the currency was trading at 23.3500 to the dollar from 23.0695 at the close of business a week ago, according to LSEG data.

Delays in restructuring the country’s debt had affected expected foreign-exchange flows, weighing on the kwacha, Bank of Zambia Governor Denny Kalyalya said on Wednesday.

Reporting by Elias Biryabarema, Christian Akorlie, Chijioke Ohuocha, Chris Mfula and Hereward Holland;
Editing by Alexander Winning

Our Standards: The Thomson Reuters Trust Principles.

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