Shilling firm, after central bank support last week
18 November 2014, 08:30
Nairobi - Kenya's shilling was holding firm against the dollar in early trade on Monday after the central bank intervened at the end of last week by selling dollars, lifting the currency from three-year lows.
By 0706 GMT, the shilling was trading at 89.80/90 to the dollar, little changed from Friday's close of 89.90/90.
In addition to central bank dollar sales, traders said investors were encouraged by Kenya's agreement last week with the International Monetary Fund on a $700 million to $750 million precautionary loan that can be drawn if needed.
"Sentiment looks a bit positive," said Peter Njuguna at Kenya Commercial Bank. "Combined with the central bank action, I think we will see the shilling anchored at these levels, trading between the 89.50 and, probably, 90.00 level."
A second trader said the shilling could slip to 90.50, citing 90.40 as the point where the central bank intervened on Friday. He said demand for dollars was subdued in early business but said demand by importers for dollars during last week could spill into this week.
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