Kenya Shilling Gains 3rd Day as Central Bank Curbs Money Supply
The currency of East Africa’s largest economy appreciated 0.2 percent to close at 83.90 per dollar, extending its gains this year to 1.4 percent, according to data compiled by Bloomberg.
Kenya sold 2.77 billion shillings ($33 million) in seven- day repurchase agreements at a weighted average rate of 16.613 percent, a central bank official, who asked not to be identified in line with policy, said.
The bank also accepted 1.75 billion shillings of 14-day term auction deposits at 16.75 percent, 1.5 billion shillings of 21-day deposits at 16.90 percent and 2.03 billion shillings in 28-day deposits at 16.94 percent, the official said today by phone from the capital. The sale today is the fifth auction from June 27 after the bank stayed out for five days from June 20 through June 26, according to data compiled by Bloomberg.
Longer-tenure term auction deposits were introduced “as an additional instrument for liquidity management,” the bank said June 5.
Kenyan inflation slowed to a 15-month low in June, declining for the seventh straight month to 10.1 percent from 12.2 percent in May, the Kenya National Bureau of Statistics said in an e-mailed statement on June 29. Inflation is down from a peak of nearly 20 percent in November. Kenya’s central bank monetary policy committee, which raised the benchmark interest rate to a record 18 percent last year to curb price gains and support the shilling, is set to meet on July 5, according to the bank’s website.
Tanzania’s shilling weakened for a second day, the longest losing streak since June 7, depreciating 0.3 percent to close at 1,580 per dollar, while Uganda’s shilling gained 0.1 percent to 2,472.50 per dollar.
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