Bloomberg News

Kenyan Shilling Declines on Month-End Dollar Demand by Companies

November 29, 2011

Nov. 28 (Bloomberg) -- Kenya’s shilling weakened against the dollar for the first session in three as demand from importers for the U.S. currency increased for end-of-month bill payments.

The currency of East Africa’s biggest economy declined 0.4 percent to 90.69 per dollar by 1:43 p.m. in Nairobi, the weakest level in a week on a closing basis, according to data compiled by Bloomberg.

“There’s some end of month demand for the dollar by the energy sector players and telecommunications as they have shipments falling due,” Duncan Kinuthia, head of trading for Commercial Bank of Africa, said by phone from Nairobi today.

Uganda’s shilling strengthened for the first day in five, adding 0.7 percent against the dollar to 2,583, as dollar demand from the power industry eased, said Dickson Musoni, head of currency trading at Kenya Commercial Bank’s Ugandan unit.

“We have seen a stronger shilling today on account of reduced demand from the energy sector,” Musoni said in a phone interview from Kampala today. “Oil importers are out of the market because they covered their demand last week.”

The Tanzanian currency lost 0.1 percent of its value against the dollar to 1,692. “Demand is coming in from traders importing various good for the Christmas season and manufacturers importing inputs,” Alex Ngurusu, head of Treasury at CRDB Bank Plc, said by phone today from Tanzania’s commercial capital of Dar es Salaam.

With assistance from Fred Ojambo in Kampala and David Malingha in Dar es Salaam --Editors: Peter Branton, Ash Kumar

--Editors: Ash Kumar, Peter Branton

--Editor: Ash Kumar

To contact the reporter on this story: Sarah McGregor in Nairobi at smcgregor5@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net


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