{"id":3842,"date":"2023-11-10T00:00:00","date_gmt":"2023-11-10T00:00:00","guid":{"rendered":"https:\/\/staging.azafinance.com\/2023\/11\/10\/naira-value-drops-again-on-the-heels-of-speculator-profit-taking-800m-cocoa-loan-to-ghana-delayed\/"},"modified":"2024-05-18T16:49:42","modified_gmt":"2024-05-18T16:49:42","slug":"naira-value-drops-again-on-the-heels-of-speculator-profit-taking-800m-cocoa-loan-to-ghana-delayed","status":"publish","type":"post","link":"https:\/\/azafinance.com\/naira-value-drops-again-on-the-heels-of-speculator-profit-taking-800m-cocoa-loan-to-ghana-delayed\/","title":{"rendered":"Naira value drops again on the heels of speculator profit taking; $800M cocoa loan to Ghana delayed","gt_translate_keys":[{"key":"rendered","format":"text"}]},"content":{"rendered":"<div class=\"infogram-embed\" data-id=\"1prdjx59g6p21mag76de1y7v23tmqn1lz2x?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;\">Last week saw a halt in the naira\u2019s dramatic appreciation against the dollar as speculators looked to buy back cheap FX. This triggered a frenzied attempt to purchase FX at recent levels as the naira reverses gains and spirals toward previous lows.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Late last week, wires reported that the Nigerian central bank had begun clearing the backlog of overdue FX forward to the tune of $6.7bn and that three banks received full payment. Certain banks also confirmed that the central bank had begun clearing the outstanding retail FX obligations although no formal figure was announced. FX demand seems to have regained steam and we expect to see the naira lose even further value against the dollar in the coming days.\u00a0<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/punchng.com\/naira-gains-as-cbn-pays-banks-6-7bn-forex-backlog\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Punch \u2014 Naira gains as CBN pays banks $6.7bn forex backlog<\/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 Bank of Ghana is showing a USD\/GHS rate of 11.5 away from current market levels of USD\/GHS 11.9.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The highly anticipated $800 million cocoa syndicated loan expected to come in at the end of November, is experiencing some delays. Therefore, the government has requested a loan from some select institutions that trade in cocoa for a total of $400 million, of which half has already been secured.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We expect the Ghana cedi to slip with the increasing demand for U.S. dollars from the government, corporations and banks.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.bog.gov.gh\/treasury-and-the-markets\/daily-interbank-fx-rates\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Bank of Ghana \u2014 Daily Interbank FX rate<\/span><\/a><\/p>\n<p><a href=\"https:\/\/www.ghanaweb.com\/GhanaHomePage\/business\/Cedi-sells-at-GH-12-15-to-1-GH-11-50-on-BoG-interbank-1877018\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Ghana web \u2014 Cedi sells at GH\u00a212.15 to $1, GH\u00a211.50 on BoG interbank<\/span><\/a><\/p>\n<p><a href=\"https:\/\/www.reuters.com\/article\/cocoa-ghana\/update-2-ghana-borrows-up-to-200-mln-from-cocoa-traders-to-plug-funding-gap-idUKL1N3C81BV\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Reuters \u2014 Ghana borrows up to $200 mln from cocoa traders to plug funding gap<\/span><\/a><\/p>\n<p><a href=\"https:\/\/www.bnnbloomberg.ca\/ghana-taps-cocoa-traders-for-400-million-as-bank-loans-delayed-1.1995074\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">BNN Bloomberg \u2014 Ghana Taps Cocoa Traders for $400 Million as Bank Loans Delayed<\/span><\/a><\/p>\n<h3><b>South African Rand (R)\u00a0<\/b><\/h3>\n<p><i><span style=\"font-weight: 400;\">Compiled by Alex Barmuta<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400;\">The South African rand gave back some of last week\u2019s gains against the U.S. dollar opening at USD\/ZAR 18.2671 before making a move back toward the 18.50 levels as of Wednesday afternoon. <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">The rand giving some of its gains back comes as no surprise, as data released from China on November 7 , showed a larger-than-expected drop in exports, leading to the weakening of many emerging market currencies.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">From a local perspective, rating agency Fitch expressed some concerns about South Africa\u2019s ability to meet its fiscal targets, due to the ongoing power cuts, among other factors.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Looking ahead, we can expect the rand to continue trading according to global risk sentiment. To the upside, some resistance can be expected around the 18.80 levels, whereas support is likely to be found at 18.45-18.50.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.moneyweb.co.za\/news\/markets\/rand-slips-on-weaker-chinese-data\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Moneyweb \u2014 Rand slips on weaker Chinese data<\/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 continues to trade around USD\/EGP 30.90 after some brief EGP strength was observed toward the end of last week, where the pair traded at USD\/EGP 30.64. There has been some dollar weakness across the board following worse-than-expected jobs report out of the U.S. on Friday. <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Over the week, Egypt has continued to allow vulnerable patients requiring immediate medical attention to pass through the Rafah crossing, which still remains the only entry and exit point from Gaza for civilians. An emergency aid convoy containing much-needed supplies has also been allowed to enter Gaza through this crossing. Tensions remain high in Gaza, with continued calls for a ceasefire by many international organizations. <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">In the weeks ahead, the Egyptian government will likely continue to perform a key mediation role in the Israel-Hamas conflict, which is already impacting Egypt with reported decreases in tourism.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.independent.co.uk\/travel\/news-and-advice\/egypt-holidays-tourism-hamas-israel-gaza-b2443259.html\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">The Independent \u2013 How the Hamas-Israel conflict is ruining tourism in Egypt<\/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 weakened to a record low between USD\/KES 151.10\/152.10 from last week&#8217;s levels between USD\/KES 149.94\/151. On\u00a0 October 7, 2023, Fitch ratings reported that they may downgrade the nation\u2019s credit rating due to the increased risks to debt sustainability and the ability to settle payments on a $2 billion eurobond due in June 2024. The government remains in talks with external partners on financing, including the International Monetary Fund (IMF), World Bank, Trade and Development Bank and African Export-Import Bank. The Kenyan president&#8217;s chief economic adviser reported the IMF has agreed to increase Kenya&#8217;s lending program by $650 million. We expect pressure on the shilling as inflows from imports reduce. The imports have dropped down to 14%\u00a0 to Sh1.7 trillion from Sh1.97 trillion last year as the shilling weakens.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.reuters.com\/world\/africa\/imf-agrees-increase-kenya-programme-by-650-mln-presidential-adviser-2023-11-07\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Reuters \u2014 IMF to increase Kenya programme by $650 mln, presidential adviser says<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/a><a href=\"https:\/\/www.fitchratings.com\/research\/sovereigns\/higher-debt-servicing-costs-to-weigh-on-kenyas-credit-profile-07-11-2023\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Fitch ratings \u2014 Higher Debt Servicing Costs to Weigh on Kenya\u2019s Credit Profile<\/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;\">This Wednesday, November 8, USD\/UGX traded at 3,755, unchanged from last Friday.. Looking ahead, we expect the USD\/UGX to increase as the Stanbic Bank Uganda PMI fell to 52.4 in October 2023 from 52.9 the previous month.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Supplier delivery times increased due to heavy rainfall which caused delays. Higher construction material and fuel prices, as well as staff costs, drove up input costs. This resulted in a rise in selling prices for the seventh month in a row. Finally, business confidence in the outlook for customer demand and output over the next 12 months is high across sectors.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/ugbusiness.com\/2023\/11\/uganda-economy\/private-sector-activity-slowed-in-october-pmi-shows#:~:text=The%20Stanbic%20Bank%20Uganda%20Purchasing,reading%20above%2050%20indicates%20growth.\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Ugbusiness \u2014 Private sector activity slowed in October, PMI shows<\/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><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The State of Senegal has sold 30 hectares of land from the former L\u00e9opold Sedar Senghor International Airport in Yoff for the construction of the Cit\u00e9 du Parc. The sale of the plots, which range from 175 to 600 square meters, has resulted in a recovery of 38 billion FCFA, according to Compagnie G\u00e9n\u00e9rale Immobili\u00e8re du Sahel\u2019s (CGIS SA) Director General Abdou Khafor Tour\u00e9.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The project, located in Dakar, will also include residential neighborhoods, business centers, and social infrastructure. Delivery of the plots is scheduled between December 2023 and February 2024.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.sikafinance.com\/marches\/senegal-la-vente-de-30-hectares-de-parcelles-de-lancien-aeroport-rapporte-71-milliards-fcfa_43427\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Sikafinance \u2014 Senegal: The sale of 30 hectares of plots of the former airport brings in 71 billion FCFA<\/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><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Niger&#8217;s transitional Prime Minister Ali Mahaman Lamine Zeine, started construction on a pipeline costing $2.3 billion linking Agadem oil fields to the port of Seme in Benin. The pipeline will allow Niger to export its oil to the international market, causing a loss of earnings for the deepwater port of Kribi in Cameroon&#8217;s southern region.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The oil is located in the eastern part of the country, close to the border with Chad. In 2013, a project agreement was signed between locals and Nigerian authorities, laying out conditions for the transit of Nigerian oil on Cameroonian territory. Cameroon is home to around 1,000 km of the 1,070 km pipeline linking Chad&#8217;s oil fields to the deepwater port of Kribi. The transit duty is a tax paid by oil companies exporting crude via the Chad-Cameroon pipeline to the Cameroonian Treasury. For every barrel of Chadian oil, Cameroon collects a $1.321 royalty, initially $0.41, which was adjusted in 2013 and 2018 after negotiations.<\/span><\/p>\n<p><b>Further reading:\u00a0\u00a0<\/b><\/p>\n<p><a href=\"https:\/\/www.businessincameroon.com\/energy\/0711-13508-boko-haram-cost-cameroon-billions-of-cfa-francs-in-transit-fees-for-nigerien-oil\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">BusinessinCameroon \u2014 Boko Haram cost Cameroon billions of CFA francs in transit fees for Nigerien oil<\/span><\/a><\/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 Last week saw a halt in the naira\u2019s dramatic appreciation against the dollar as speculators looked to buy back cheap FX. This triggered a frenzied attempt to purchase FX at recent levels as the naira reverses gains and spirals toward previous lows. Late last week, wires reported that [&hellip;]<\/p>\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"author":1,"featured_media":3843,"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-3842","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\/3842","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=3842"}],"version-history":[{"count":0,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts\/3842\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/media\/3843"}],"wp:attachment":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/media?parent=3842"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/categories?post=3842"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/tags?post=3842"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}