Jan. 31 (Bloomberg) -- Kenya’s shilling strengthened for the sixth day, the longest winning streak in 10 months, on “tight liquidity” and as the euro appreciated against the dollar.
The currency of East Africa’s biggest economy appreciated as much as 1.1 percent and was trading 0.7 percent stronger at 84.10 per dollar at 3:44 p.m. in the capital Nairobi. This is the longest winning streak since March.
“The shilling is gaining against the dollar on account of tight liquidity in the money market” and following gains of the euro, Jeremiah Kendagor, acting head of trading at Nairobi-based Kenya Commercial Bank Ltd., said in a phone interview.
The euro strengthened 0.3 percent to $1.3180, its sixth gain in seven days, as Greek Prime Minister Lucas Papademos said progress had been made in debt-swap talks with bondholders.
Kenya’s inflation rate fell for a second month to 18.3 percent in January from 18.9 percent in December, the Nairobi- based Kenya National Bureau of Statistics said today in an e- mailed statement. The central bank’s monetary policy committee is meeting tomorrow.
Tanzania’s shilling advanced on increased dollar inflows from the agricultural industry and low dollar demand. The currency of East Africa’s second-biggest economy appreciated as much as 0.6 percent and was trading 0.3 percent stronger at 1,595.
“The shilling has gained due to inflows coming in from agriculture particularly the cashew nuts and low demand for dollars,” Fred Siwale, a dealer with CRDB Bank Plc, said today by phone from Dar es Salaam, the commercial capital.
Uganda’s shilling strengthened for the third day on tight liquidity, appreciating as much as 0.8 percent, and traded 0.5 percent stronger at 2,322.75.
“The shilling gained on tight liquidity,” Abbey Mutabali, a currency trader at Centenary Bank Ltd., said by phone from Kampala. “The outlook is of a further rally of the shilling because of its tightness.”
--With assistance from Fred Ojambo in Kampala and David Malingha Doya in Dar es Salaam. Editors: Peter Branton, Stephen Kirkland
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