The Kenyan shilling rose to the highest level against the dollar in 10 months amid muted demand for the greenback from importers in East Africa’s largest company.
The currency added 0.3 percent to 100.35 per dollar as of 11.33 a.m. in the capital, Nairobi, the highest since July 6 on a closing basis. The shilling extended its gain this week to 0.7 percent, the most since the five days ended Oct. 9. Yields on the Eurobond due June 2024 were little-changed at 8.09 percent, the highest since March 16.
Kenya’s economic growth accelerated to 5.6 percent in 2015 from 5.3 percent in the previous year as earnings from agricultural exports and construction outweighed a slowdown in tourism, the nation’s statistics agency said on May 3. The shilling is poised to gain for a third week, with Commercial Bank of Africa pointing to elevated inflows of foreign currency.
“We anticipate a continued bullish run in today’s trading as importer activity remains subdued,” the Nairobi-based bank said Friday in an e-mailed note.
Kenya is benefiting from lower oil prices, with foreign reserves rising about 10 percent in the past year to a record $7.6 billion in April as the country’s import bill shrinks and the central bank buys dollars to curb strength in the shilling.