Kenyan Shilling Gains Most in Nine Months on Lower Dollar Demand
Kenya’s shilling strengthened to its highest in more than nine months on lower dollar demand and speculation of U.S. currency inflows from tea exporters.
The currency of East Africa’s biggest economy appreciated as much as 0.4 percent and traded 0.3 percent higher at 83.40 per dollar as of 12:14 p.m. in the capital, Nairobi. A close at this level would be the highest since May 2, according to data compiled by Bloomberg.
“The shilling is gaining on account of low dollar demand and expectations of dollar inflows from tea sales,” Duncan Kinuthia a dealer at Nairobi-based Commercial Bank of Africa Ltd., said in a phone interview today.
Tanzania’s shilling strengthened for the first time in four days, appreciating as much as 0.5 percent and trading 0.2 percent higher at 1,592.50 as of 12:13 p.m.
“Government authorities have been changing dollars to shillings as donors begin releasing money for budgetary support,” Eric Chijoriga, a trader with National Bank of Commerce, ABSA Group’s local unit, said today by phone from Dar es Salaam, the commercial capital.
Development partners have released over 90 percent of the funds they committed to support the country’s 2011/2012 budget, Filberto Ceriani Sebregondi, head of European Union delegation to Tanzania, said. Donors committed about $500 million in general budget support, Sebregondi said in a statement posted on the delegation’s website dated Jan. 30.
The Ugandan shilling appreciated for a second day, trading 0.2 percent higher at 2,310 per dollar as of 10:55 a.m.
-- With assistance from David Malingha Doya in Dar es Salaam. Editors: Ash Kumar, Peter Branton
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