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8 Oct 2016
Naira may record gain next week
The naira is expected to stabilise on the parallel market after international money transfer agencies started selling dollars to Bureau De Change operators in line with the Central Bank of Nigeria directive.
“We have started receiving dollar supply from Travelex and we expect this to gradually impact positively on the naira exchange rate going forward,” the President, Association of Bureau De Change Operators of Nigeria, Aminu Gwadabe, told Reuters.
The naira was quoted at 470 to the dollar on the black market on Friday, compared with 473 on Thursday. At the interbank market, the naira closed at 305.5 per dollar.
The kwacha is likely to remain firm next week due to conversions of hard currency by companies preparing to pay taxes that are due in the local unit on October 14.
At 1117 GMT, commercial banks quoted the currency of Africa’s second-largest copper producer at 9.8900 per dollar from 9.8000 a week ago.
“The Kwacha is expected to continue trading with a bullish tone against the dollar on the back of strong corporate and interbank inflows. Trading range is expected to be between K9.800 and K9.850 in the near term,” Zambia National Commercial Bank said in a note.
The Kenyan shilling is expected to remain stable in the coming week, although dollar sales from multi-national companies buying shillings to pay tax obligations could offer a boost, traders said.
At 1100 GMT, commercial banks quoted the shilling at 101.15/35 to the dollar, compared with 101.25/35 at last Thursday’s close.
“I expect corporates will be selling dollars in advance of tax dues,” said a trader from one commercial bank.
The Ugandan shilling is forecast, to trade on a weaker footing as commercial banks rush to buy dollars in anticipation of further weakening of the local currency due to demand from energy and manufacturing companies.
At 1159 GMT, commercial banks quoted the shilling at 3,408/3,418, weaker than last Thursday’s close of 3,380/3,390.
A trader at one leading commercial bank said “banks will be rushing to expand positions because they don’t want to be caught short.”
The Tanzanian shilling is expected to hold steady in the days ahead, helped by subdued demand for dollars from importers.
Commercial banks quoted the shilling at 2,178/2,188 to the dollar on Thursday, weaker than 2,175/2,185 a week ago.
“I do not see any significant movement in the market over the coming week. The shilling is anticipated to trade in the same levels going forward,” said Francis William, a dealer at Commercial Bank of Africa Tanzania.