Shilling records major fall against U.S. dollar

Source: Xinhua| 2017-06-17 00:00:55|Editor: huaxia
Video PlayerClose

NAIROBI, June 16 (Xinhua) -- The Kenya shilling recorded a major fall against the U.S. dollar Friday as demand for dollars from the retail importers surged.

The local unit ended the day at 103.60, a major decline from Thursday's 103.45 as dollar demand outstripped inflows, with the Central Bank reportedly selling dollars to save the shilling from further decline.

The apex bank, however, quoted the shilling at the close of Friday at 103.55, a slightly stronger level.

On the other hand, commercial banks placed the value of the local unit at between 103.55 and 103.75 from the previous day's 103.45 and 103.65, as traders noted the apex bank had sold unspecified amount of dollars to stem the currency fall.

Similarly, the shilling weakened against the British pound Friday to stand at 132.04 from 131.86 the previous day.

Kenya's forex reserve denominated in dollars stood at 8.2 billion dollars last week or an equivalent to 5.3 months of import cover, down from 8.3 billion dollars from 5.5 months of cover.

The slight decline during the period was attributed to rising dollar demand from importers, especially those bringing in oil, sugar, and maize, with prices of the last two hitting the roof due to shortage.

These reserves are expected therefore to fall further this week, with analysts noting Central Bank may sell more next week to support the shilling. Enditem