Thursday, 17 September 2015 01:12
NAIROBI: Kenya’s shilling made modest gains on Wednesday after the central bank sold an undisclosed amount of dollars, while stocks were up.
At the close of trade at 1330 GMT, the shilling was quoted at 105.55/65 to the US dollar, compared with Tuesday’s close of 105.70/80.
The shilling had almost touched an all-time low of 106.80 last week, before the central bank intervened with dollar sales to support it.
Traders said the bank intervened again at 1245 GMT on Wednesday and sold dollars through brokers.
“There was a lot of central bank activity as they do not want to cross that 106.00 (versus the dollar) level,” said one trader at a Nairobi-based bank.
The central bank does not usually comment on its interventions.
The central bank’s announcement last week that its reserves dipped to $ 6.252 billion, below the four months import cover it usually keeps, has rattled nerves. But one trader said the bank had an International Monetary Fund facility it could draw on.
As well as facing pressure from a strengthening dollar on global markets, the shilling has been hit by worries about Kenya’s current account deficit and a downturn in the tourism industry, which has been hurt by a spate of militant attacks.
On the equity market, the benchmark NSE 20 Share Index edged up 6.68 points, or 0.2 percent to close at 4257.27 points.
On the secondary market, government bonds valued at 526 million shillings ($ 4.99 million) were traded, down from 619 million shillings the previous day.
