NAIROBI: Kenya’s shilling and Ghana’s cedi could weaken next week on increased dollar demand, while Zambia’s currency is seen strengthening further on dollar inflows chasing government debt.
Kenya an expected surge in dollar demand by importers could weaken the shilling next week, after the currency traded stronger following a central bank sale of dollars on Tuesday. At 0847 GMT, commercial banks quoted the shilling at 96.00/10 to the dollar, from 95.25/35 a week ago. “From next week, importers are going to start buying dollars in anticipation of end-month demand. So we could still continue to see the shilling remain under pressure,” Bobby Otieno, treasurer at Ecobank Kenya, said.
Traders said they forecast the shilling to trade between 96.00 to 97.00 against the dollar next week. GHANA The cedi hit a record low on Wednesday and could remain under pressure on strong dollar demand, traders said.
“The reason is simple, supply is weak while demand is strong,” said Michael Akpakli, a trader for Barclays Bank Ghana. The cedi traded at 3.9350-3.9750 to the dollar at 1200 GMT on Thursday, after briefly touching 3.9400 on Wednesday, part of a slide that has seen it fall by 17 percent this year and 31 percent last year.
The Bank of Ghana surprised markets by raising the benchmark interest rate by 100 bps to 22.0 percent in part to slow the cedi’s decline, Governor Henry Kofi Wampah said.
