Bloomberg News

Kenya Shilling Strengthens as Central Bank Offers Second Sell

October 19, 2012

Kenya’s shilling strengthened, pushing the currency toward a weekly gain, as the central bank removed money from the market through four-day repurchase agreements for the first time in more than three months.

The currency of East Africa’s largest economy gained as much as 0.4 percent to 84.85 a dollar, the most since Sept. 5 and was trading less than 0.1 percent higher to 85.15 a dollar at 4:12 p.m., in the capital, Nairobi.

The Central Bank of Kenya sold 2.9 billion shillings ($34 million) of seven-day repurchase agreements, an official who asked not to be identified in line with policy, said by phone. The bank later sold 2.4 billion shillings of 4-day repurchase agreements, the first such sale since June 6, according to data compiled by Bloomberg.

“The shilling is being supported by the central bank, with the second repurchase agreement propping it up, but with demand expected to build up in the coming days, it will be under pressure,” Julius Kiriinya, a dealer at Nairobi-based African Banking Corp., said by phone.

Tanzania’s shilling weakened 0.4 percent to 1,581 a dollar, while the Ugandan shilling gained less than 0.1 percent to 2,577 a dollar.

To contact the reporter on this story: Johnstone Ole Turana in Nairobi at jturana@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net


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