Ghana’s cedi seen slipping on unmet dollar demand

Ghana’s cedi is expected to weaken next week on a shortage of dollars, while Zambia’s kwacha is set to firm as companies convert forex ahead of month-end salary payments.

GHANA

Ghana’s cedi could weaken marginally next week on unmet corporate dollar demand, unless there is significant boost in central bank forex sales, analysts said.

The local currency, which has remained fairly stable in recent months, was trading at 3.9705 to the dollar at 11:35 GMT on Thursday compared to 3.9680 a week ago and down around 4 percent year-to-date.

“We expect the local unit to hold cagily below the 4.000 mark on the interbank market as the firm demand is expected to exert pressure on the currency,” Barclays bank Ghana trader Jake Brobbey said.

ZAMBIA

The kwacha is likely to firm next week due to anticipated conversions of hard currency by firms preparing to pay month-end costs and taxes.

At 13:40 GMT on Thursday, commercial banks quoted the currency of Africa’s second largest copper producer at 9.9800 per dollar from 10.2150 a week ago.

“Corporates need to pay salaries and other month-end obligations. We also have company taxes due on 14 October,” one commercial bank trader said.

NIGERIA

The naira is expect to remain stable around the present level at both official interbank and parallel markets as demand from holiday makers slows and the central bank ups its support for the local currency at the official window.

The naira firmed a little at the parallel market to 423 a dollar from 425 to the dollar last week, while it was quoted at 315 a dollar on the official window at 11:17 GMT.

“We don’t expect any major depreciation of the naira in the near term as most summer holiday makers are back and demand for the dollar slow a little,” Aminu Gwadabe president of association of Bureau de Change operators said.

UGANDA

The Ugandan shilling is seen trading on an even keel over the next few days, supported by subdued demand as importer firms and banks are unwilling to buy dollars above the support level of 3,385.

At 1115 GMT commercial banks quoted the shilling at 3,372/3,382, stronger than last Thursday’s close of 3,380/3,390.

“When the shilling hits 3,385, we see a drop off in appetite, players are unwilling to buy (dollars) above that level,” said David Bagambe, trader at Diamond Trust Bank.

KENYA

The Kenyan shilling is expected to remain stable against the dollar due to expected inflows from rail and road construction companies selling dollars to pay for supplies amid demand from oil importers. At 12:00 GMT, commercial banks quoted the shilling at 101.20/40 to the dollar, the same as last Thursday’s close.