Zambia’s currency faces ongoing pressure while Nigeria, Ghana, and Uganda are likely to remain stable. Nigeria’s naira is rangebound due to central bank interventions, Ghana’s cedi is stable amid weak demand, and Uganda’s shilling is supported by coffee exports. Conversely, Zambia’s kwacha is under pressure from high demand for hard currency.
In Zambia, the national currency is anticipated to face ongoing pressure over the coming week, with an expectation for stability in the currencies of Nigeria, Ghana, and Uganda, as indicated by traders.
In Nigeria, the naira is expected to maintain a range due to the central bank’s frequent intervention in dollar sales aimed at supporting the currency. As of Thursday, the naira was quoted at 1,501 to the dollar in the official market, a slight improvement from 1,508 the previous week. A trader expects the exchange rate to fluctuate between 1,490 and 1,510 naira, noting that the government’s budget aims to keep rates around 1,500 naira.
Ghana’s cedi is projected to remain stable, aided by weak foreign currency demand and enhanced central bank support. It was valued at 15.45 to the dollar on Thursday, a marginal decrease from 15.50 the previous week. Sedem Dornoo, a senior trader at Absa Bank Ghana, indicated that the market for hard currency appears balanced, with subdued dollar demand from key sectors such as energy and manufacturing contributing to this stability.
In Uganda, the shilling is also expected to remain steady, supported by strong coffee export flows. On Thursday, commercial banks quoted the shilling between 3,676 and 3,686 to the dollar, compared to last week’s close of 3,665 and 3,675. A trader suggested that the coffee sector is presently the main influencer of the shilling’s performance, forecasting oscillation within a range of 3,650 to 3,680.
Conversely, Zambia’s kwacha is likely to stay under pressure, with demand for hard currency surpassing supply. The kwacha was quoted at 28.36 per dollar, an increase from 28.15 per week prior. According to a note from the Zambia National Commercial Bank, minor losses are expected due to thin supply in the near term.
In summary, while Zambia’s kwacha is under significant strain due to insufficient hard currency supply, the currencies of Nigeria, Ghana, and Uganda are expected to maintain stability. Nigeria’s naira remains subject to central bank interventions, Ghana’s cedi is relatively balanced amid low demand, and Uganda’s shilling benefits from coffee export flows. Overall, currency dynamics in the region appear mixed, with Zambia facing distinct challenges.
Original Source: www.brecorder.com
