March 21 (Bloomberg) -- Kenya’s shilling depreciated the most in more than two weeks as the East African nation awaits the outcome of a challenge to Uhuru Kenyatta’s presidential election victory.
The currency of the region’s biggest economy retreated as much as 0.4 percent and traded 0.3 percent lower at 85.77 per dollar by 1:37 p.m., the most on a closing basis since March 6, according to data compiled by Bloomberg.
Outgoing Prime Minister Raila Odinga, whose dispute of the 2007 election triggered ethnic clashes that left more than 1,100 people dead, filed a Supreme Court petition on March 16, challenging Kenyatta’s March 4 vote win. Odinga today canceled plans to hold rallies after Chief Justice Willy Mutunga told the leaders to keep from making public statements about the case.
“The shilling is on a weakening mode as the markets await the outcome of the presidential case,” Duncan Kinuthia, head of trading at Commercial Bank of Africa Ltd., said by phone today from Nairobi.
The currency will probably be “range-bound until new information comes into the market, as most players are on the sidelines waiting to see how the petition will go,” Nairobi-based NIC Bank Ltd., said in an e-mailed note today.
The Central Bank of Kenya is offering 12 billion shillings ($140 million) in seven-day repurchase agreements today, which it uses to reduce money supply and support the shilling, according to an official who asked not to be identified in line with policy said by phone.
Uganda’s currency gained 0.4 percent to 2,630 per dollar, while the Tanzanian shilling strengthened 0.2 percent to 1,621 per dollar.
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