Naira Falls, Rand Slips, Kenyan Shilling Stays Flat

Here’s this week’s overview of the Nigerian Naira, Kenyan Shilling, and South African Rand:

Nigerian Naira

The Nigerian Naira weakened by 1.55% against USD last week to trade at 1645 to the dollar on Friday.

Nigeria's currency reached a historic intraday low of 1,655 per USD on the official market, amid dwindling dollar liquidity during the week.

The strain on the local currency market has been exacerbated by increased demand from travellers and importers during the summer holidays, coupled with lower yields on treasury bills offered by the central bank.

On a positive note, however, Nigeria's trade surplus widened to an all time high of NGN 4,128 billion in June 2024, up from NGN 1,039 billion in the corresponding month of the previous year.

Exports jumped approximately 164% annualised to an all time high of NGN 7,281 billion, boosted by shipment of energy, crude oil, raw materials, agricultural good and manufactured goods.

This can be expected to give some upward force to the struggling currency, offsetting downward momentum to some degree.

Kenyan Shilling

Kenyan Shilling remained flat against the dollar last week to trade at 128.25 on Friday. There were no significant data releases out of Kenya last week.

South African Rand

South African Rand closed 0.6% stronger against the Dollar last week to trade at 17.73 on Friday.

Domestically, the South African Reserve Bank is widely anticipated to begin cutting rates on September 19th, with a 25bps reduction expected, amidst a benign disinflation trend.

Headline inflation sank below 5% in July, the lowest in three years, slowing to 4.6% in July from 5.1% in June, after holding steady for 10 months in the 5% to 6% range.