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African currencies are set for a mixed performance in the coming week, with Ghana’s cedi expected to weaken further against the dollar, while the shilling in Kenya, the naira in Nigeria, the shilling in Uganda, and the kwacha in Zambia are likely to remain broadly stable, traders have said.
In Kenya, the shilling is forecast to stay firm against the U.S. dollar. Commercial banks quoted the local unit at 129.00/40 per dollar on Thursday, compared with last week’s close of 129.25/65. A trader from one commercial bank told Reuters that stability is expected in the coming week. “For the next week, it will be stable, no change,” the trader said, suggesting that dollar supply and demand are balanced for now.
Nigeria’s naira is also expected to remain in a tight trading range as the Central Bank of Nigeria (CBN) and licensed exchange bureaus continue to intervene by selling dollars to importers and travellers. The naira closed around 1,533 per dollar at the official market on Thursday, compared with 1,534 a week earlier, while on the parallel market it traded near 1,540. Market participants said easing inflation and central bank interventions have limited speculative trading, keeping the naira within a narrow band. “The naira is likely to stay in a narrow range between 1,520 and 1,560 next week,” one trader explained.
Ghana’s cedi, however, is expected to weaken further due to sustained demand for dollars and limited central bank liquidity support. According to London Stock Exchange Group (LSEG) data, the cedi was trading at 10.90 to the dollar on Thursday, down from 10.70 at last week’s close. A currency trader in Accra noted that corporate demand, particularly from the manufacturing, commerce, and services sectors, remains strong. “FX demand from local corporate accounts remains firm. We expect the cedi to slide further against the dollar in the coming week,” the trader said.
Chris Nettey, head of trading at Stanbic Bank Ghana, also warned that the weakness could persist until supply and demand conditions are balanced. He added that ongoing reforms and increased interventions from the Bank of Ghana could help stabilise the cedi in the medium term. In a related move, the central bank instructed all banks to stop disbursing foreign currency to large corporate clients unless such withdrawals are fully backed by equivalent deposits. Authorities said unbacked foreign currency withdrawals by bulk oil distributors, mining firms, and other large companies were worsening pressure on the local currency and threatening financial stability.
In Uganda, the shilling is expected to trade steadily in the coming days. On Thursday, commercial banks quoted the currency at 3,560/3,570 against the dollar, slightly weaker than last week’s 3,553/3,563 close. An independent forex trader in Kampala said subdued dollar demand following a traders’ strike is supporting stability. “We expect dollar appetite from merchandise importers to remain slow as activity slowly recovers from the strike,” the trader said. Ugandan traders recently staged a two-day strike in Kampala and other towns, protesting against high taxes and what they described as an influx of Chinese merchants in their retail businesses.
Zambia’s kwacha is also expected to hold firm despite signs of mild pressure from increased corporate demand for dollars. On Thursday, the kwacha was quoted at 23.53 per dollar, compared with 23.36 a week earlier. Zambia National Commercial Bank noted in its market outlook that the kwacha will likely remain range-bound but may experience slight losses. “We expect the kwacha to trade within range, but could post some minor losses due to corporate greenback appetite,” the bank said.
The outlook for African currencies continues to highlight the different pressures facing economies across the continent. While central bank interventions are helping to keep the Kenyan shilling, Nigerian naira, Ugandan shilling, and Zambian kwacha relatively stable, Ghana’s cedi remains under strain from high corporate demand and limited supply. Analysts say stronger central bank measures and increased inflows will be key to stabilising the cedi in the weeks ahead.
