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Kenya Shilling at Fresh 7-week high vs dollar

Discussion in 'Kenyan News and Politics' started by RAJ PATEL JR, Nov 12, 2011.

  1. RAJ PATEL JR

    RAJ PATEL JR JF-Expert Member

    #1
    Nov 12, 2011
    Joined: Sep 8, 2010
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    Nov. 11 (Bloomberg) -- Kenya's shilling, the world's best- performing currency against the dollar this month, headed for its biggest weekly gain in three years as a curb in the money supply pushed banks to sell dollars.
    The currency of East Africa's biggest economy gained for a fifth day, rising as much as 1.8 percent to 93.25 per dollar and was trading 1.6 percent higher at 93.45 at 2:37 p.m. in the capital Nairobi. This brings the weekly gain to 4 percent, the highest since November 2008, according to data compiled by Bloomberg.
    "The tightening of monetary policy has pushed the borrowing rate at the overnight window to an average of 30 percent, pushing banks to offload their dollar position for the local currencies," Bernard Matimu, the chief dealer at Nairobi- based NIC Bank Ltd., said in a phone interview.
    Kenya's Monetary Policy Committee, led by Governor Njuguna Ndung'u, increased the key lending rate by 5.5 percentage points to a record 16.5 percent, the Nairobi-based central bank said on Nov. 1.
    The Tanzanian shilling strengthened by 0.5 percent to 1,747.35 per dollar and was trading 0.1 percent higher at 1754 at 1:24 p.m.
    "There was significant supply of dollars from the mining and logistics sector which caused the appreciation of the shilling," Eric Chijoriga, a trader with National Bank of Commerce Ltd., Absa Group's local unit, said today by phone from Dar es Salaam, Tanzania's commercial Capital. "Earlier we saw demand for dollars come in from oil importers," he said.
    Uganda's currency appreciated as much as 0.9 percent at 2,586 per dollar and was up 0.4 percent at 2,600 at 2:15 p.m.
    "The shilling has gained because of subdued demand of the dollars in the market due to the prevailing tight liquidity," Dickson Musoni, a currency trader at Kenya Commercial Bank's Ugandan unit, said by phone from Kampala.
    --With assistance from Fred Ojambo in Kampala and David Malingha Doya in Dar es Salaam. Editors: Peter Branton, Alan Purkiss
    --Editors: Peter Branton, Chris Peterson
    bloomberg.net;

     
  2. RAJ PATEL JR

    RAJ PATEL JR JF-Expert Member

    #2
    Nov 12, 2011
    Joined: Sep 8, 2010
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    Where are those of us who initially claimed that Kenya's economy would be tanking because of the war with Al Shabab bandits?
     
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