Kenyan, Ugandan shillings expected to weaken, traders say
The Ugandan and Kenyan shillings are expected to weaken against the dollar in the next week to Thursday, traders said.
The Kenyan shilling is forecast to weaken due to end-month dollar demand from the energy and manufacturing sectors amid thin inflows from diaspora remittances and offshore investors, traders said. Commercial banks quoted the shilling at 104.60/80 per dollar, compared with 102.40/60 at last Thursday’s close. “Next week, as we move toward end of the month, we should see more demand. There are no investors coming in for now,” said a senior trader from one commercial bank.
In Uganda, Uganda’s shilling is expected to weaken due to slowing dollar supply from remittances and increased demand from commercial banks and offshore investors amid uncertainty from the coronavirus outbreak. Commercial banks the shilling at 3,815/3,825, compared to last Thursday’s close of 3,700/3,710. “Remittances from Ugandans working abroad have effectively dried up while offshore investors are paring their positions.
The long and short of that is that we will definitely see significant (shilling) weakening,” said a trader at a commercial bank who forecast it to weaken to 3,900 to the dollar in coming days. The local currency has weakened this week, prompting the central bank to sell dollar twice to lend support to the local currency.