Kenyan Shilling Weakens Third Day as Oil Importers Seek Dollars

Kenya’s shilling slid for the third day on increased dollar demand from oil importers and as the central bank limited the amount of money it removed from the market.

The currency of East Africa’s largest economy retreated 0.2 percent to 85.63 a dollar, poised for the lowest level since June 5, by 1:21 p.m. in Nairobi, the capital.

“There is increased demand for dollars largely from the energy sector and we have seen the central bank accepting fewer bids for its securities,” Julius Kiriinya, a trader at Nairobi-based African Banking Corp., said by phone.

The Central Bank of Kenya accepted 7.5 billion shillings ($88 million) of seven-day repurchase agreements out of bids of 31.69 billion shillings at a sale yesterday. The bank offered 2 billion shillings in repos today, an official who declined to be identified in line with policy, said by phone. The central bank has been offering repos to control money supply in the market.

Uganda’s shilling strengthened less than 0.1 percent to 2,601.5 a dollar, while the Tanzanian shilling weakened less than 0.1 percent to 1,594 a 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