Kenya’s shilling appreciates by 0.1pc on dollar sales

The Kenya Shilling appreciated against the USD by 0.1 percent last week to close at Kshs 103.3 from 103.4 recorded previously.

“This is attributed to investors who had bought dollars for speculative purposes in the run up to elections continue to sell dollars in the market and buy back the shilling,” says Cytonn Investments Weekly brief.

“In coming weeks, the outcome of the election petition will play a role in determining the performance of the shilling in the short term,” the note adds.

On a year to date basis, the shilling has depreciated against the dollar by 0.7 percent.

Against the Euro, Yen and the Pound, the shilling has lost 12.1 percent, 7.6 percent and 5.2 percent YTD, respectively.

The significant depreciation against the Euro, Yen and Pound is as a result of stronger economic fundamentals in the Eurozone, UK and Japan as compared to the US, that have pushed further the expected path for the US interest rate hike cycle.

The shilling lost ground against the South African rand which was buoyed by economic release in the week indicating a slowdown in inflation to a two-year low.
On the regional front, the shilling eased 0.13 percent against the Ugandan currency while remained mute against Tanzanian shilling.