The west African cocoa, gold and oil exporter will hold presidential and parliamentary elections on December 7. Ghana has seen currency instability in the past three election years as nervous investors repatriate investments. The cedi has been under pressure this week, risking a breach of the 1.91 barrier after initially trading around 1.89.
The currency was at 1.9090/15 versus the greenback in early afternoon trading on Thursday after opening the day's session at 1.9055. "The market is tight - it is reaching the panic phase and unless the central bank comes with a vigorous support, the trend will continue next week," Stanbic Bank trader Christopher Nettey said.
KENYA: Kenya's shilling is seen firming slightly against the dollar in the days ahead, helped by diaspora remittances and the central bank mopping up liquidity as demand for the greenback subsides. The shilling has come under pressure in the past few weeks as importers bought dollars to meet their purchases ahead of the Christmas holidays. The local currency was posted at 85.85/86.05 to the dollar in morning trade, 0.2 percent weaker than last Thursday's close of 85.65/85.
"We are seeing end-month demand (for dollars) fizzle out. With this, we price in a mild appreciation in the shilling in coming days," said Duncan Kinuthia, head of trading at Commercial Bank of Africa.
UGANDA: Uganda's shilling is forecast to stabilise as high dollar demand from importers, which sent the local currency tumbling to a 13-month low in recent days, starts to recede. Commercial banks quoted the currency of east Africa's third-largest economy at 2,691/2,701, weaker than last Thursday's close of 2,640/2,650. A combination of soaring greenback demand from importers and offshore investors has pressured the shilling over the last two weeks, prompting the central bank to intervene twice. "In the coming days the market is likely to favour a largely stable shilling possibly in the range of 2,690/2,710."
TANZANIA: Tanzania's shilling is expected to firm against the dollar next week, helped by increased sales of the greenback by the central bank. Commercial banks in east Africa's second-biggest economy quoted the shilling at 1,594/1,604 to the dollar on Thursday, stronger than 1,608/1,618 a week ago. "We expect to see a gradual appreciation of the shilling, largely thanks to the aggressive intervention of the central bank by pumping more dollars into the market and also as a result of strong month-end flows," said Eric Chijoriga, a trader at NBC Bank, a unit of South Africa's Absa Group.
Market participants said they expect the shilling to trade in the 1,590-1,610 range next week. "Going forward, the shilling should continue to gain ground against the dollar provided that oil companies do not come into the market with an unexpectedly huge demand for the US currency," said a trader at a commercial bank in Dar es Salaam.
ZAMBIA: Zambia's kwacha is expected to remain on the back foot next week due to increasing demand for the dollar as retailers buy the greenback to stock up for the holiday season. On Thursday morning the kwacha slid to 5,270 against the dollar, its weakest in more than four months, due to increased appetite for the dollar ahead of the festive season. "The pressure should continue going into next week if the central bank does not intervene," one commercial bank trader said. "But I don't think it will soften beyond the current levels because these are very attractive levels for would be-sellers of dollars," he said.
NIGERIA: The naira is seen steady around 157.50-158 to the dollar next week on expected dollar flows from oil companies' month-end sales and offshore investors buying local debt. The currency was trading at 157.45 to the dollar on the interbank market in late morning trade, firmer than the previous day's close of 157.55, due to flows from two energy companies. "We see the naira stabilising within the present band of 157.50-158 to the dollar level next week as more dollars flow to the market from oil companies and offshore investors buying treasury bills at an auction next week," one dealer said.