ACCRA, Oct 4 (Reuters) - Ghana’s cedi and Zambia’s kwacha are seen holding their ground or moving toward the stronger side over the next one week, lifted by local tax payments.
Ghana’s cedi could hold ground against the dollar on the back of hard currency inflows from a $1.3 billion cocoa loan that is expected to boost the central bank’s interbank support capacity, analysts said.
The cedi, which had been under pressure for several weeks mainly due to global headwinds, has recouped some of its losses this week. It was trading at 4.9500 to the greenback compared with 4.9850 a week ago.
“In Q4, however, the cedi is expected to remain fairly stable as forex liquidity improves on the back of inflows from cocoa loans — (Dollar)Demand is also not expected to be as strong in the early weeks of Q4,” said currency analyst Joseph Biggles Amponsah.
The Kwacha is expected to remain firm next week as dollar supply from companies that will be paying taxes continues to outweigh demand levels in the market.
On Thursday, commercial banks quoted the currency of Africa’s second-largest copper producer at 11.4000 per dollar, stronger than a close of 12.3750 a week ago.
“Current trends seem to indicate that the local unit is poised for further gains should supply continue to outweigh demand,” a local commercial bank, Cavmont said in a note.
The Kenyan shilling is expected to remain stable in the coming week due to thin importer and corporate dollar demand meeting with some inflows from horticulture and tourism sectors meeting.
At 0925 GMT, commercial banks quoted the shilling at 100.90/101.00 per dollar, the same level as last Thursday’s close.
A trader at a leading commercial bank said the shilling would trade stable because appetite for hard currency was “at the moment...a bit quiet,” while some inflows from tourists and exporters of flowers were offering support.
The Ugandan shilling is seen trading with a broadly strengthening tone after the central bank hiked its benchmark lending rate amid worries over inflationary pressures.
At 1009 GMT commercial banks quoted the shilling at 3,770/3,780, compared to last Thursday’s close of 3,815/3,825.
A trader at a leading commercial bank said he anticipated the shilling to “benefit from the impact of the rate decision.”
Bank of Uganda this week raised its policy rate by 100 basis points to 10 percent as policy makers cited worries over growing inflationary pressures. The trader said the shilling would oscillate between 3,760-3,800 over the next one week. (Reporting by Chris Mfula, John Ndiso, Kwasi Kpodo, Elias Biryabarema; Compiled by Elias Biryabarema)