Kenya, Ghana and Zambia currencies to ease, Tanzania's to firm

NAIROBI, Sept 29 (Reuters) - Kenya, Ghana and Zambia's currencies are expected to come under pressure against the dollar in the next week, while Tanzania's is likely to strengthen. Uganda's shilling is seen holding steady.


Kenya's shilling KES= is expected to weaken, as dollar demand from fuel importers and corporate clients outpaces supply, and with little expectation of central bank support.

Commercial banks quoted the shilling at 120.65/85 per dollar, compared with last Thursday's close of 120.30/50.

The shilling touched a fresh all-time low of 120.70/90 on Thursday, according to Refinitiv data.

"I expect to see a bit more demand as we enter the final quarter as manufacturers make their import orders," a trader said.

"Demand is across the board," said another trader.


Ghana's cedi GHS= is seen under pressure in the coming week as an International Monetary Fund (IMF) team visits the county to assess its debt burden, analysts said.

Refinitiv Eikon data showed the cedi was trading at 10.15 to the dollar on Thursday compared to 10.10 at last Thursday's close. It hit a new low of 10.20 on Tuesday.

"I see downward pressure in the week ahead as the market awaits the announcement from negotiations with the IMF team," said Jerome Kuseh, an analyst and founder of the blog CediTalk.

Fears of a debt restructuring or sovereign default have loomed. But the cedi's losses could be partly offset by a $1.3 billion loan due to be signed by Ghana's Cocoa Board (COCOBOD) on Thursday, said Takudzwa Ndawona, an analyst at ETM Analytics.


Zambia's kwacha ZMW= is likely to remain under mild pressure against the dollar next week due to continued high demand for hard currency amid subdued supply.

On Thursday, commercial banks quoted the currency of Africa's second-largest copper producer down at 15.9200 per dollar from 15.8500 at the close of business a week ago.

"There is likely to be a small depreciation because the kwacha appreciation was largely due to positive sentiment after the IMF approved Zambia's programme," financial analyst Trevor Hambayi said.


Tanzania's shilling TZS= is expected to strengthen, helped by the central bank's push to reduce liquidity in the market.

Commercial banks quoted the shilling at 2,327/2,337 against the dollar on Thursday, the same levels recorded at last Thursday's close.

"The Bank of Tanzania said recently it will continue to gradually reduce liquidity in the market until the end of October to tackle rising inflation," said Kristine Van Helsdingen, a dealer at AZA Finance, a Nairobi-based FX trading firm.

"Following a recent U.S. investors' trip to Tanzania, we expect inflows to strengthen the shilling in the near term," she said.


The Ugandan shilling UGX= is expected to hold steady, drawing some support from typical month-end dollar inflows from the agriculture sector.

Commercial banks quoted the shilling at 3,860/3,870, compared with last Thursday's close of 3,820/3,830.

"There are some flows from coffee, tea and other agricultural shipments which are offering support," said an independent foreign exchange trader in the capital Kampala.

He said the shilling will likely trade in the 3,840-3,870 range in the next week.
Reporting by Hereward Holland, Nuzulack Dausen, Chris Mfula, Cooper Inveen, Christian Akorlie, Elias Biryabarema; Compiled by George Obulutsa and Nellie Peyton; Editing by James Macharia Chege

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