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Kenya Shilling Gains for Second Day as Bank Curbs Money Supply

Kenya’s shilling gained the most in almost two weeks as the central bank curbed money supply through its largest sale of securities in a week.

The currency of East Africa’s largest economy appreciated as much as 1.1 percent to 84.24 per dollar and was trading 0.4 percent stronger at 84.85 at 4:29 p.m. the biggest gain since Oct. 3 and extending its winning streak to two days.

“The shilling is responding to the persistent mop-up by the central bank, which is trying to maintain money supply to ensure stable prices,” Jeremiah Kendagor, head of trading at Nairobi-based Kenya Commercial Bank Ltd. (KNCB), said by phone.

The Central Bank of Kenya sold 7.81 billion shillings ($92 million) of repurchase agreements and term-auction deposits, an official who asked not to be identified in line with policy, said by phone. This is the highest amount sold since Oct 8, according to data compiled by Bloomberg.

Tanzania’s shilling weakened 0.3 percent to 1,576 a dollar, while the Ugandan shilling gained 0.7 percent to 2,580 per dollar.

To contact the reporter on this story: Johnstone Ole Turana in Nairobi at jturana@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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