{"id":3832,"date":"2023-10-12T00:00:00","date_gmt":"2023-10-12T00:00:00","guid":{"rendered":"https:\/\/staging.azafinance.com\/2023\/10\/12\/foreign-currency-shortage-puts-added-pressure-on-naira-funds-approved-for-infrastructure-projects-in-senegal\/"},"modified":"2023-10-12T00:00:00","modified_gmt":"2023-10-12T00:00:00","slug":"foreign-currency-shortage-puts-added-pressure-on-naira-funds-approved-for-infrastructure-projects-in-senegal","status":"publish","type":"post","link":"https:\/\/azafinance.com\/foreign-currency-shortage-puts-added-pressure-on-naira-funds-approved-for-infrastructure-projects-in-senegal\/","title":{"rendered":"Foreign currency shortage puts added pressure on naira; Funds approved for infrastructure projects in Senegal","gt_translate_keys":[{"key":"rendered","format":"text"}]},"content":{"rendered":"<div class=\"infogram-embed\" data-id=\"1p9g5pqn75yg2ph71qlxv1krpvu3v5gwzjg?live\" data-type=\"interactive\"><\/div><script>!function(e,t,s,i){var n=\"InfogramEmbeds\",o=e.getElementsByTagName(\"script\"),d=o[0],r=\/^http:\/.test(e.location)?\"http:\":\"https:\";if(\/^\\\/{2}\/.test(i)&&(i=r+i),window[n]&&window[n].initialized)window[n].process&&window[n].process();else if(!e.getElementById(s)){var a=e.createElement(\"script\");a.async=1,a.id=s,a.src=i,d.parentNode.insertBefore(a,d)}}(document,0,\"infogram-async\",\"\/\/e.infogram.com\/js\/dist\/embed-loader-min.js\");<\/script>\n<h4><b>Nigerian Naira (\u20a6)\u00a0<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Ikenga Kalu<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">This week, the Naira lost further ground against the U.S. dollar and trended towards USD\/NGN 1030 in the parallel market.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">The country continues to battle a foreign currency shortage that is even impacting fuel importers. Nigeria is largely reliant on petrol imports despite being a large producer of oil as it has limited onshore refinery options. It has been widely reported that Nigeria&#8217;s national oil firm NNPC Ltd., is now the sole importer of fuel as private importers are unable to support the demand and pay for imports due to a shortage of foreign currency.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">The rate is likely to depreciate further in the coming week as FX demand continues to increase.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.reuters.com\/business\/energy\/nigerias-nnpc-now-sole-petrol-importer-forex-shortages-choke-rivals-2023-10-09\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Reuters \u2013 Nigeria&#8217;s NNPC now sole petrol importer as forex shortages hit rivals<\/span><span style=\"font-weight: 400\">\u00a0<\/span><\/a><\/p>\n<h4><b>Ghanaian Cedi (GH\u00a2)<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Sakina Seidu<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">The Ghanaian cedi continued to drop to an average rate of USD\/GHS 11.95, with indications of crossing the USD\/GHS 12.00 barrier soon.<\/span><\/p>\n<p><span style=\"font-weight: 400\">A recorded Consumer Price Inflation of 38.10% shows easing costs of general consumer goods for Ghana from a rate of 40.10% in August. A major driver of Inflation in Ghana, food, saw a 5% decline to a rate of 49.40% for the month of September.<\/span><\/p>\n<p><span style=\"font-weight: 400\">With demand still rising with no hope of easing, the U.S. dollar is expected to keep gaining against the cedi in the short term.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.ghanaweb.com\/GhanaHomePage\/business\/Cedi-sells-at-GH-11-95-to-1-GH-11-26-on-BoG-interbank-as-of-October-11-1860035\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Ghana web \u2014 Cedi sells at GH\u00a211.95 to $1, GH\u00a211.26 on BoG interbank as of October 11<\/span><\/a><span style=\"font-weight: 400\">\u00a0<\/span><\/p>\n<p><a href=\"https:\/\/statsghana.gov.gh\/gssmain\/storage\/img\/marqueeupdater\/CPI%20September_2023.pdf\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Ghana statistical service \u2014 Ghana Consumer Price Index (CPI) and Inflation<\/span><\/a><\/p>\n<h4><b>South African Rand (R)\u00a0<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Alex Barmuta<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">The USD\/ZAR closed trading last week at 19.2797. As of Wednesday afternoon, the South African rand has moved under the 19 handle against the U.S. dollar, testing the 18.80 support level.<\/span><\/p>\n<p><span style=\"font-weight: 400\">The rand\u2019s rather surprising gains against the dollar this week are largely driven by a weaker dollar rather than a surge of rand demand. The Federal Open Market Committee (FOMC) minutes on Wednesday evening could fuel more moves,\u00a0 depending on the general tone and how it is interpreted by investors.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Looking ahead, we can expect the rand to be volatile, possibly trading in the 18.60-19.00 range.\u00a0<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.dailyfx.com\/news\/usdzar-price-forecast-us-data-will-test-short-term-direction-20231010.html\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">DailyFX \u2014 USD\/ZAR Price Forecast: US Data will Test Short Term Direction<\/span><\/a><\/p>\n<h4><b>Egyptian Pound (EGP)<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Mitchell Diedrick<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">The Egyptian pound appreciated against the U.S. dollar toward the end of last week to trade at levels of USD\/EGP 30.68 before depreciating once again to USD\/EGP 30.90 this week.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Inflation data released by the Egyptian Central Bank revealed that annual core inflation had declined marginally to 39.7% in September 2023 from 40.4% in August 2023. In comparison, annual inflation as a whole \u2014 including some of the more volatile items that are stripped out of core inflation \u2014 rose to 38% from 37.8% in August 2023.<\/span><span style=\"font-weight: 400\"><br \/>\n<\/span><span style=\"font-weight: 400\"><br \/>\n<\/span><span style=\"font-weight: 400\">This week, the Egyptian pound is likely to remain at these levels against the U.S. dollar in the absence of any intervention or external shocks.\u00a0<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.egypttoday.com\/Article\/3\/127558\/Monthly-urban-inflation-hikes-to-38-with-annual-inflation-rate\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Egypt today \u2013 Monthly urban inflation hikes to 38%, with annual inflation rate witnessing slight decline<\/span><\/a><\/p>\n<h4><b>Kenyan Shilling (KSh)<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Terry Karanja<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">The Kenyan shilling closed trading last week at USD\/KES 148.68 as it continues to depreciate against the U.S. dollar.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">The rapid and consistent depreciation of the shilling (over 20% year-to-date) means that Kenya has fallen from sixth to the seventh spot in the Absa Africa Financial Markets Index. Further to this, trade data released by the Central Bank of Kenya (CBK) shows that imports dropped by just under 14% so far in 2023. This has prompted a capital control proposal where firms holding an \u201cexcessive\u201d amount of dollars could face fines of up to KES 10,000,000 (approximately USD 67,000).\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">Looking ahead, we can expect the shilling to remain under pressure. A move beyond the USD\/KES 149 level is possible in the coming week.\u00a0<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/africa.businessinsider.com\/local\/markets\/kenyan-mp-proposes-dollar67000-fine-for-firms-accused-of-hoarding-dollars\/vdlq8bj\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Business Insider Africa \u2014 Kenyan MP proposes $67,000 fine for firms accused of hoarding dollars<\/span><\/a><\/p>\n<h4><b>Ugandan Shilling (USh)<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Yadhav Panday<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">On Wednesday, October 11, 2023, USD\/UGX was trading at 3,745.00, up 0.13% from the previous trading session.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400\">In the coming days, we expect the USD\/UGX to rise due to work stoppages caused by violations of safety regulations at Uganda&#8217;s $2 billion Kingfisher oil field. The 40,000 barrels-per-day oil field was scheduled to begin production in early 2025, but the regulator said work will be halted until an investigation into a fatal accident on October 6, 2023, when a worker was crushed by a truck is completed.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Work at the oil field near Uganda&#8217;s western border with the Democratic Republic of the Congo has been halted for the past two days following the incident.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.marketscreener.com\/quote\/commodity\/WTI-2355639\/news\/Safety-Concerns-Suspend-Uganda-Oil-Field-Development-45018315\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Marketscreener \u2014 Safety Concerns Suspend Uganda Oil Field Development<\/span><\/a><\/p>\n<h4><b>Tanzanian Shilling (TSh)<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Kristin Van Helsdingen<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">The Tanzanian shilling continues to be closely monitored by the Bank of Tanzania resulting in the Tanzanian shilling trading closely with the U.S. dollar. USDT\/TZS has remained between 2,505 and 2,510 and is currently trading at 2,510.<\/span><\/p>\n<p><span style=\"font-weight: 400\">\u00a0<\/span><span style=\"font-weight: 400\">President Samia Suhulu Hassan has contributed toward generating revenue through tourism through her film in 2022 called, <\/span><i><span style=\"font-weight: 400\">Tanzania: Royal Tour<\/span><\/i><span style=\"font-weight: 400\">. This week the National Bureau of Statistics (NBS) released data indicating that tourism increased by 25.7%, from 900,182 visitors in 2022 to 1,131,286 this year.<\/span><\/p>\n<p><span style=\"font-weight: 400\">Tanzania has continued to strengthen its ties with India and in addition, President Hassan appealed to Indian investors to look to Tanzania. With ongoing efforts to bring in foreign investments and strengthen relations to promote trade, we can expect the shilling to remain relatively stable in the week ahead, moving between USD\/TZS 2,505 and 2,512.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.africa-press.net\/tanzania\/all-news\/tanzania-records-25pc-increase-in-tourist-arrivals\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">AFRICA PRESS \u2013 Tanzania records 24pc increase in tourist arrivals<\/span><\/a><\/p>\n<p><a href=\"https:\/\/www.africa-press.net\/tanzania\/all-news\/tanzania-india-elevate-ties\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">AFRICA PRESS \u2013 Tanzania India elevate ties<\/span><\/a><\/p>\n<p><a href=\"https:\/\/www.africa-press.net\/tanzania\/all-news\/president-samia-lures-indian-investors\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">AFRICA PRESS \u2013 President Samia lures Indian investors<\/span><\/a><\/p>\n<h4><b>West African CFA Franc Region (XOF)\u00a0<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Yashveer Singh<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">The Economic Community of West African States (ECOWAS) Bank for Investment and Development (EBID) has approved 65 billion FCFA (99 million euros) in funding for Senegal during its 85th board of directors meeting in Lom\u00e9, Togo. This funding is allocated for two significant projects aimed at boosting the country&#8217;s socio-economic development and indirectly benefiting the ECOWAS region by promoting increased commercial activities across various sectors.<\/span><\/p>\n<p><span style=\"font-weight: 400\">The first project involves 50 billion FCFA for infrastructure development in the urban commune of Diamniadio, located about 30 kilometers from Dakar. This new city is intended to host key industries, logistics services, and business activities, making it essential to provide state-of-the-art infrastructure and technology systems to facilitate international business activities in the modern context.<\/span><\/p>\n<p><span style=\"font-weight: 400\">The second project, allocated 15 billion FCFA, focuses on the Tivaouane-M\u00e9kh\u00e9 section within the Dakar-Tivaouane-Saint Louis highway construction program. This ambitious 200 km highway project aims to connect the major coastal cities of Senegal. The goal is to drive economic development in the project area, particularly in agriculture, mining, fishing, and tourism, while also stimulating regional trade within ECOWAS and North Africa.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.sikafinance.com\/marches\/senegal-65-milliards-fcfa-de-la-bidc-pour-le-developpement-des-infrastructures-et-le-commerce_42967\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Sikafinance \u2014 Senegal: 65 billion FCFA from the EBID for infrastructure development and trade<\/span><\/a><\/p>\n<h4><b>Central African CFA Franc Region (XAF)<\/b><\/h4>\n<p><i><span style=\"font-weight: 400\">Compiled by Yashveer Singh<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400\">In August 2023, despite efforts by the Bank of Central African States (BEAC), to control inflation in Cameroon, the inflation rate exceeded 7% in nine out of 10 regional capitals, with peaks of 10.3%, 8.3%, and 8.2% in Bertoua, Bafoussam, and Ngaound\u00e9r\u00e9, respectively. The National Statistics Institute (INS) attributed this surge in prices to a significant increase in food products (+13.3%) and transport (+10.4%). BEAC had been taking measures such as raising key interest rates, suspending liquidity injections, and increasing liquidity recovery operations with banks since 2022, but these efforts seem insufficient.<\/span><\/p>\n<p><span style=\"font-weight: 400\">BEAC also noted that only 20% of the inflation is of monetary origin, meaning the measures taken by the central bank have no impact on the remaining 80% of inflation.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.businessincameroon.com\/public-management\/0910-13460-inflation-surpasses-7-in-9-regional-capitals-in-august-2023-despite-beacs-efforts\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400\">Business in Cameroon \u2014 Inflation surpasses 7% in 9 regional capitals in August 2023, despite Beac&#8217;s efforts<\/span><\/a><\/p>\n<p>\u00a0<\/p>\n<p><em>Issued by AZA Finance, this Newsletter is produced as a service to our clients. It is prepared by our dealing professionals and is based on their understanding and interpretation of market events. AZA Finance cannot be held responsible for any losses of whatever nature sustained as a result of action taken based on comments contained in this publication.<\/em><\/p>\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"excerpt":{"rendered":"<p>Nigerian Naira (\u20a6)\u00a0 Compiled by Ikenga Kalu This week, the Naira lost further ground against the U.S. dollar and trended towards USD\/NGN 1030 in the parallel market.\u00a0 The country continues to battle a foreign currency shortage that is even impacting fuel importers. Nigeria is largely reliant on petrol imports despite being a large producer of [&hellip;]<\/p>\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"author":1,"featured_media":3833,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[19],"tags":[22,23,24,25,26,27,185,29,30,31,32,298,34,33,303,305],"class_list":["post-3832","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fx-insights","tag-africa-foreign-exchange","tag-cairo","tag-cfa-franc","tag-dollars","tag-egypt","tag-egyptian-pound","tag-foreign-exchange","tag-fx","tag-fx-insights","tag-ghana","tag-ghana-cedi","tag-kenyan-shilling-rate","tag-naira","tag-rand-rate","tag-tanzanian-shilling-rate","tag-ugandan-shilling-rate"],"acf":[],"gt_translate_keys":[{"key":"link","format":"url"}],"_links":{"self":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts\/3832","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/comments?post=3832"}],"version-history":[{"count":0,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts\/3832\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/media\/3833"}],"wp:attachment":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/media?parent=3832"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/categories?post=3832"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/tags?post=3832"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}