Kenya shilling stable, liquidity to set path
10 February 2014, 12:42
Nairobi - The Kenyan shilling was barely moved against the dollar on Monday and traders said it could face pressure in the days ahead due to improving liquidity in the money markets.
At 0710 GMT, commercial banks posted the shilling at 85.95/86.05, barely changed from Friday's closing rate of 86.00/10.
Market participants said the currency could weaken due to tumbling overnight lending rates that could make it slightly cheaper for banks to hold long dollar positions.
"With liquidity improving on the money markets side, we could see the shilling come under pressure," said Duncan Kinuthia, head of trading at Commercial Bank of Africa
The overnight rate on the interbank borrowing market dropped to 10.4298 percent on Friday from 11.1740 percent on Thursday.