Uganda’s currency is anticipated to decline, while most others are projected to remain stable

Traders indicated that Uganda’s currency is anticipated to depreciate against the dollar in the upcoming week leading to Thursday, whereas the currencies of Nigeria, Ghana, Kenya, and Zambia are expected to remain relatively stable.

Uganda

Uganda’s shilling is expected to decline due to increased dollar demand from foreign-owned companies seeking to distribute dividends.

Commercial banks quoted the shilling at 3,595/3,605 to the U.S. currency, compared to last Thursday’s close of 3,585/3,595. “It’s around the time when foreign-owned entities are paying their last year’s dividends … some are exerting demand for that purpose,” one trader noted.

He mentioned that the local unit is expected to fluctuate between 3,580 and 3,620 against the dollar in the upcoming week.

Nigeria

The naira of Nigeria ought to maintain stability, bolstered by interventions from the central bank to uphold the currency.

On Thursday, the naira was quoted at 1,354 to the U.S. dollar in the official market, a slight improvement from 1,357 the previous week.

In street trading, the currency was exchanging at 1,365 to the dollar.

“I anticipate the market will maintain stability between 1,350 and 1,360 naira next week,” a trader remarked. “I believe this range will be applicable for the upcoming week.” The central bank has engaged with the market from both the buying and selling perspectives over the past week or two.

Ghana

Ghana’s cedi is anticipated to remain stable due to subdued corporate dollar demand and central bank forex auctions.

LSEG data indicated that the cedi is trading at 10.60 to the dollar, a decrease from 10.99 a week prior.

“Corporate dollar demand has remained low, while enhanced FX inflows from the mining sector and ongoing intermediation by the central bank through its auction program have bolstered near-term supply,” stated Ronald Mensah, a trader at Stanbic Bank Ghana. “We anticipate this positive trend to continue in the upcoming sessions, supported by balanced flows and sustained policy backing,” he noted.

Andrews Akoto, head of trading at Absa Bank Ghana, noted that forex demand from the energy and commerce sectors had decreased, while mining inflows remained stable and interbank liquidity had enhanced.

Kenya

The forecast indicates that Kenya’s shilling will remain stable.

Commercial banks have set the shilling at 128.80/129.10 to the dollar, maintaining the same rate as last Thursday’s close. “A trader observed that the balance between supply and demand prevents any pressure on either side.”

Zambia

Zambia’s kwacha is anticipated to maintain its current levels following a strong performance this year, bolstered by substantial copper export receipts.

On Thursday, commercial banks reported the currency of Africa’s second-largest copper producer at 18.99 per dollar, down from 19.08 a week earlier.

Access Bank noted that copper export earnings continued to be the main driver of foreign exchange supply.