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WEEKAHEAD-AFRICA-FX-Kenyan shilling seen strengthening, Zambia unit under pressure

PUBLISHED: Thu, 01 Apr 2021 11:52:32 GMT

NAIROBI, April 1 (Reuters) – Kenya’s shilling is expected to gain ground against the dollar next week while the Zambian kwacha could weaken, traders said.

KENYA

The Kenyan shilling could benefit from muted importer dollar demand in the midst of increased inflows from offshore investors into a government infrastructure bond.

Commercial banks quoted the shilling at 109.10/30 per dollar, compared with last Thursday’s close of 109.65/109.85.

“Demand for dollars from importers is really subdued,” a trader at one commercial bank said.

ZAMBIA

The Kwacha is likely to weaken against the dollar due to demand for foreign exchange to pay for imports, including petroleum products and agricultural inputs.

On Thursday, commercial banks quoted the currency of Africa’s second largest copper producer at 22.0750 per dollar, slightly down from 22.0231 at the close of business a week ago.

“In the interim, the local unit is expected to trade range bound with a bias towards the weaker side,” Zambia National Commercial Bank (ZANACO) said in a note.

UGANDA

The Ugandan shilling is expected to be stable over the next one week amid a slump in demand due to the long Easter weekend.

At 0849 GMT, commercial banks quoted the shilling at 3,660/3,670, unchanged from last Thursday’s close.

“Demand will be on the low side owing to the fact that economic activity itself will be lacklustre because of the Easter holiday,” said an independent currency trader.

TANZANIA Tanzania’s shilling could weaken slightly next week due to the end-of-month dollar demand from importers and manufacturers.

On Thursday, commercial banks quoted the shilling at 2,310/2,326 per dollar, compared with 2,314/2,324 last week. (Reporting by George Obulutsa, Chris Mfula and Elias Biryabarema; Editing by Alex Richardson)

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