NAIROBI Feb 14 The Tanzanian shilling is seen
weaker on oil sector demand for dollars while the Kenyan
shilling looks set to be pressured by tight liquidity The
Nigerian and Ugandan currencies are seen rising on strong dollar
Tanzania's shilling is seen under pressure in the coming
days, weighed down by strong demand from oil importers and
declining dollar inflows, traders said.
Traders in Tanzania's commercial capital Dar es Salaam
quoted the shilling at 1,611/1,621 to the dollar on Thursday,
stronger than 1,620/1,630 a week ago.
"The shilling is expected to remain under pressure from the
oil sector and other importers next week, because we are seeing
very little inflows of dollars into the market," said Theopistar
Mnale, a trader at Tanzania Investment Bank.
Market participants said the shilling was likely to trade in
the 1,610-1,620 range in the days ahead.
"Let's hope the central bank will continue to intervene in
the market and stop the shilling from further depreciation. But
we don't expect the shilling to go below 1,600 levels even if
the central bank intervenes aggressively through increased
dollar sales and tighter monetary policy controls."
The Kenyan shilling is seen coming under pressure in
days ahead as the squeeze on liquidity, that has been supporting
the currency, loosens due to government debt redemptions.
The shilling slipped for the first time in seven sessions
to 87.30/50 against the dollar on Thursday, but was still
stronger than last Thursday's close of 87.55/75.
"We're expecting some bond maturities next week that will
ease liquidity a bit and weight on the shilling," said Pally
Muchiri, a senior trader at Co-operative Bank.
The central bank has been draining shillings from the market
on a daily basis and sold dollars in seven separate sessions
this year, in a bid to support the local currency.
Nigeria's naira firmed on Thursday to its strongest
since Jan. 28, after dollar flows from offshore investors buying
local debt boosted liquidity, and was seen stable at this level
next week on fresh dollar flows from offshore.
The naira was trading at 157.25 to the dollar on the
interbank market at 1035 GMT, firmer than the 157.45 it closed
the market on Wednesday. It was last seen at this level on Jan.
28, when it closed at 157.15 to the dollar.
"There were some dollar inflows from offshore investors
buying local debt at an auction on Wednesday, which help buoyed
dollar liquidity and provided support for the naira," one dealer
Nigeria sold 105 billion naira ($667.22 million) worth of
sovereign bonds maturing in 2017, 2019, 2022 and 2030
on Wednesday, with strong demand from offshore investors and
pension funds pushing yields lower. [ID: nL5N0BE85I]
Uganda's shilling is seen firming against the dollar
in coming days as upcoming elections in neighbouring Kenya
dampen importers' dollar demand on fears of delays to imports.
The March presidential vote in Kenya is the first since a
disputed election in 2007 which unleashed nationwide violence,
blocking major trading routes of landlocked countries including
Uganda and Rwanda which depend on Kenya's Mombasa port.
At 0910 GMT, commercial banks posted the shilling at
2,635/2,645 to the dollar, stronger that last Thursday's close
"(Importers) are cautious of goods being held at the
(Kenyan) port," said Robert Aloo, head of trading at Kenya
Traders said importers had already made purchases of
commodities such as fuel, while others were planning to resume
business after the Kenyan elections.
Seif Kiwanuka, head of trading at Diamond Trust Bank said
interest rates were seen raising after the government said on
Wednesday it wanted to increase domestic borrowing by 0.7
percent of GDP this fiscal year, signalling offshore appetite in
the debt market.
(Reporting by Kevin Mwanza, Oludare Mayowa, Elias Biryabarema
and Fumbuka Ng'wanakilala; editing by Ron Askew; Editing by