Naira Drops Amid Rate Hike; Rand Surges on Positive Sentiment

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

Nigerian Naira

The Nigerian Naira weakened by 4.75% against USD last week to trade at 1666 to the dollar on Friday. The Central Bank of Nigeria unanimously decided to further increase its benchmark interest rate by 50 bps to a new record high of 27.25% on Monday, marking the fifth consecutive hike this year. The decision aimed at quelling inflation, supporting the Naira and attracting investment. Markets clearly remain unconvinced, however, as the Naira sold off on Friday.

Kenyan Shilling

Kenyan Shilling remained flat against the dollar last week to trade at 128.5 on Friday. There were no significant data releases out of Kenya last week.

South African Rand

South African Rand closed 1.8% stronger against the Dollar last week to trade at 17.1 on Friday. South Africa's Rand extended gains against the dollar on Friday, hitting a fresh 20-month high amid improved risk appetite internationally and positive sentiment domestically. The new administration has now provided stability, and the Rand may have further room for improvement moving forward.