Kenyan Shilling Strengthens as Tea Prices Advance at Auction
Kenya’s shilling strengthened against the dollar on increased inflows of the U.S. currency from the sale of agricultural products.
The currency of East Africa’s biggest economy appreciated as much as 0.5 percent to 99.38 per dollar and was trading 0.2 percent stronger at 99.75 by 12:47 p.m. in Nairobi, the capital, from yesterday’s close of 99.90.
African tea prices increased to an average of $2.65 a kilogram (2.2 pounds) at an auction in the Kenyan port city of Mombasa today, up from $2.61 a week earlier, Tea Brokers East Africa Ltd. said in an e-mailed report yesterday.
“The strengthening of the shilling is due to increased inflows from the agricultural sectors and the market is experiencing minimal dollar demand ahead of tomorrow’s public holiday,” Bernard Matimu, chief dealer at Nairobi-based NIC Bank Ltd., said by phone today.
The shilling has depreciated 19 percent this year, making it the world’s worst performer against the dollar. Inflation accelerated for the eleventh consecutive month in September to 17.3 percent from 16.7 percent in August, more than triple the government’s target, on higher food and fuel costs.