Kenya Shilling Weakens for Third Day on March Election Concern
Kenya’s shilling retreated for a third day, with businesses accumulating dollars as the country prepares for March presidential elections.
The currency of East Africa’s biggest economy slipped as much as 0.2 percent to 87.70 per dollar and traded 0.1 percent weaker at 87.60 by 4 p.m. in Nairobi.
Kenya will hold its presidential vote on March 4, the first since a disputed 2007 poll sparked two months of violence in which more than 1,100 people died. The currency may decline to 89 a dollar by voting day, according to a Bloomberg News survey of analysts and traders last month.
“The shilling has weakened on dollar demand from corporates,” Duncan Kinuthia, head of trading at Commercial Bank of Africa Ltd., said by phone from Nairobi.
The central bank accepted 6.5 billion shillings ($74 million) of seven-day repurchase agreement bids today, said an official who asked not to be identified in line with policy. The bank, which had offered 10 billion shillings, uses the repos to withdraw money supply from the market and support the currency.
The shilling is likely to trade at levels between 87.45 per dollar and 85 today, NIC Bank Ltd. (NICB) said in a note to clients.
Tanzania’s shilling depreciated for a sixth day, weakening 0.2 percent to 1,623 per dollar, the lowest since December 2011, while the Ugandan shilling gained 0.3 percent to 2,657.24 per dollar.
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