Kenya shilling steady in Wednesday trading

The Kenya shilling consolidated gains made against the US dollar when trading opened on Wednesday morning, dropping only one cent to trade at 84.99 units to the dollar in CBK mean rates. Photos/File  

By CHARLES MWANIKI,

Posted  Wednesday, April 3  2013 at  12:57

The Kenya shilling consolidated gains made against the US dollar when trading opened on Wednesday morning, dropping only one cent to trade at 84.99 units to the dollar in CBK mean rates.

The shilling had hit a six month high against the dollar at 84.98 units when trading resumed after the long Easter weekend on Tuesday, reacting positively to the peaceful conclusion of the presidential poll petition.

The local unit held steady Wednesday morning, as demand and supply of dollars in the market evened out, according to forex dealers.

“We expect with the levelling of demand and supply in the market the shilling will largely hold steady for the next few days at this level. Once we are done with the inauguration and a new cabinet is in place then business will pick up some more and the shilling is likely to appreciate further,” said Mr Peter Mutuku, a dealer at Bank of Africa.

In commercial banks, the shilling was listed as opening the day trading at 84.90/85.20 to the dollar, having closed Tuesday at an average of 84.80/85.10.

Market watchers have however said that a strong return of investors to the market may pressure the shilling into slowing down its gains.

“We expect the shilling to slightly strengthen further towards the 84.50 level but pent up demand from importers might check the gains,” said ABC Treasury in a note.

The shilling remained competitive during the election period, partly due to the peaceful nature of the polls that reassured investors and Central Bank mopping up excess liquidity from the market.