Cedi and Kwacha Face Fresh Pressure as Naira Holds Near 1,348/$

On Nov 12, traders said Ghana’s cedi and Zambia’s kwacha are expected to weaken against the dollar in the week to Thursday, while Kenya’s shilling, Nigeria’s naira and Uganda’s shilling are seen little changed. The cedi was quoted at 11.70 to the dollar, down from 11.65 a week earlier, as corporate demand for foreign exchange continued to outweigh supply on the interbank market.

Ghana and Zambia under pressure

LSEG data showed the cedi at 11.70 to the dollar compared with 11.65 a week before. Andrews Akoto, head of trading at Absa Bank Ghana, said: "The cedi is expected to remain under pressure next week, driven by persistent foreign exchange demand from the services and commerce sectors."

Zambia’s kwacha should continue to depreciate gradually, weighed down by hard-currency appetite. It was quoted at 20.74 to the dollar on Thursday, compared with 20.62 a week earlier.

Kenya and Uganda steady

Kenya’s shilling is expected to hold steady. Commercial banks quoted it at 129.90/130.10 per dollar, compared with last Thursday’s closing rate of 129.80/130.00. A trader said the central bank had been in the market selling dollars, keeping the shilling stable.

Uganda’s shilling may also be steady, helped by remittance inflows. Commercial banks quoted it at 4,105/4,115, compared with last Thursday’s close of 4,040/4,050. A trader said the shilling was likely to oscillate in the 4,050-4,150 range against the dollar in the coming days, extending this week’s relative stability after a volatile period. The shilling crashed through repeated all-time lows against the dollar in October before an emergency interest rate hike helped stabilise the foreign exchange market.

Nigeria holds near official rate

Nigeria’s naira is likely to be little changed, supported by central bank dollar sales and inflows into government securities. The naira was quoted at 1,348 to the dollar on the official market on Thursday, little changed from 1,346 a week ago. The currency was changing hands at around 1,425 to the dollar in street trading.

For Nigerian businesses and consumers, the official rate stayed close to 1,348/$ while street trading was around 1,425/$, leaving a gap between official and parallel market quotes.