By Spy Uganda
Kampala: The Kenyan, Zambian and Ugandan currencies are expected to weaken next week, while those from Nigeria and Tanzania hold steady.
The Ugandan shilling is seen trading with a slightly weakening tone due to demand for dollars from merchandise importers looking to ship in goods to meet an anticipated spike in demand.
This month authorities are also scrapping long-standing anti-coronavirus measures, including re-opening schools, bars and allowing other entertainment activities.
“As all these sections of the economy open up we expect a major rebound in demand for dollars,” said a trader at one of the commercial banks.
At 0947 GMT commercial banks quoted the shilling at 3,538/3,548, compared to last Thursday close of 3,540/3,550.
Kenya’s shilling is expected to ease against the dollar in the coming week as demand for imports climbs following a quiet holiday period.
Commercial banks quoted the shilling at 113.15/35 per dollar, compared with last Thursday’s close of 113.05/25.
“The shilling is likely to remain under pressure as demand picks up from manufacturing and energy sectors,” said one trader at a commercial bank.
The kwacha is expected to remain under pressure against the dollar next week as the market awaits a full pick up in corporate activity such as exports after the holiday season.
On Thursday, commercial banks quoted the currency of Africa’s second largest copper producer at 16.7500 per dollar, marginally down from 16.6264 at the close of business a week ago.
“Interim trends suggest that the rate may continue on this trend owing to tight supply of dollars,” Access Bank said in a note.
The Nigerian naira is seen flat next week on the unofficial market where it trades more freely, as demand builds up after the holidays and dealers take position on the currency, traders said.
The currency was steady on the week at 570 naira per dollar on the parallel market on Thursday. On the official market, it traded outside an eight-month range of 409-415 against the dollar last week to a low of 435 naira.
“There hasn’t been too much activity in the first week of trading,” one commercial bank trader said.
Demand for hard currencies tailed off due to the holidays. Nigeria is battling dollar shortages brought on by low oil prices, following disruptions linked to the COVID-19 pandemic.
Tanzania’s shilling is expected to hold steady next week with hard currency inflows seen helping to balance the demand for dollars from oil and manufacturing importers.
Commercial banks on Thursday quoted the shilling at an average of 2,302/2,312, nearly the same as a week earlier.