Kenyan Shilling Gains as Tea Prices Climb to a Three-Year High
Kenya’s shilling gained to the strongest in more than a week on increased inflow of dollars after tea prices rose to the highest in more than three years at an auction.
The currency of East Africa’s largest economy appreciated 0.3 percent to 83.85 a dollar, the highest on a closing basis since July 30, by 4:28 p.m. in Nairobi.
The best tea, known as broken peko 1, climbed to $4.16 a kilogram (2.2 pounds) from $3.34 a kilo a week earlier, Tea Brokers East Africa Ltd, said in an e-mailed statement yesterday.
“The prices are the highest since at least July 2009 and they are being driven by lower global production,” Peter Kimanga, chairman of the East Africa Tea Trade Association in Mombasa, said in a phone interview.
Central Bank of Kenya sold 3 billion shillings ($36 million) of seven-day repurchase agreements at a weighted average yield of 9.84 percent, a central bank official, who asked not to be named in line with policy, said today. That compares with the 9.07 billion-shilling the bank received in bids.
The Tanzanian shilling gained less than 0.1 percent to 1,576 a dollar, increasing for the first time in three days. Uganda’s shilling weakened less than 0.1 percent to 2,480 a dollar.
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