Kenyans shilling inches down after liquidity surge
11 July 2014, 14:29
Nairobi - The Kenyan shilling edged down against the dollar on Friday mainly due to a rise in liquidity in the money markets and traders buying dollars to square their positions ahead of the weekend.
At 0805 GMT, commercial banks posted the shilling at 87.65/75, slightly down from Thursday's close of 87.60/70.
"There is a bit more liquidity in the market and that is putting pressure on the shilling," said Nahashon Mungai, a trader at KCB Bank, adding that banks were also closing off their positions ahead of the weekend.
The yield on the benchmark 91-day Treasury bills tumbled to 9.727 percent at Thursday's auction from 11.408 percent at last week's sale, pointing to an abundance of liquidity in the money markets.
The shilling has been stuck in a band of 87.20-88.00 in recent weeks with positive factors like higher foreign exchange reserves balanced by worries over a spate of attacks blamed on Islamist militants.