January 23, 2020 / 4:14 PM / a month ago

WEEKAHEAD-AFRICA-FX-Uganda's shilling and Zambia's kwacha to firm

NAIROBI, Jan 23 (Reuters) - Uganda’s shilling and Zambia’s kwacha are both expected to strengthen slightly against the U.S. dollar in the next week while Kenya’s shilling will hold steady, traders said.

KENYA

The Kenyan shilling is expected to remain stable in the week ahead, with commercial banks quoting the currency at 100.85/101.05 per dollar, compared with 100.95/101.15 at last Thursday’s close.

“There could be a rise in demand with the new month around the corner ... but there is ample dollar supply in the market,” said a trader for one commercial bank.

UGANDA

The Ugandan shilling is seen trading with a strengthening bias on the back of month-end hard currency inflows from non-governmental organisations looking to pay salaries and other expenses.

At 0805 GMT commercial banks quoted the shilling at 3,670/3,680, unchanged from last Thursday’s close.

A trader at a leading commercial bank said the market was expecting flows of hard currency from charities and some commodity exporters that typically come in the last days of the month.

“The local currency will probably move up a little (strengthen) on the back of that,” he said.

The local currency, he said, is likely to swing in the 3,650-3,670 range in the coming week.

ZAMBIA

The kwacha is likely to make some marginal gains against the U.S. dollar as companies buy the local currency to meet month-end obligations. On Thursday commercial banks quoted the currency of Africa’s second-largest copper producer at 14.5000 per dollar, against a close of 14.6250 a week ago.

“It is biased towards a bit of appreciation because corporates are preparing to pay salaries and other month-end obligations,” a senior commercial bank trader said. (Compiled by Elias Biryabarema and Chris Mfula Editing by David Goodman)

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