Kenyan shilling steady, vulnerable to offshore dollar demand

NAIROBI: The Kenyan shilling was steady on Thursday, but traders said it remained vulnerable to importers and offshore investors taking profit from this year's shares rally.

At 0732 GMT, commercial banks quoted the shilling at 85.00/20 to the dollar, barely changed from Wednesday's close of 85.10/20.

"The shilling might weaken gradually towards 85.50 in coming days. We expect some importer dollar demand and offshore buyers," said John Muli, a trader at African Banking Corporation.

Kenya's main NSE-20 share index has gained 20 percent so far this year as foreign investors faced with minimal returns on investments in developed markets have bought local stocks. A peaceful presidential election in March also helped lift sentiment.

Some traders said the central bank may offer support to the shilling, by mopping up liquidity and the occasional sale of dollars directly to banks, to maintain stability in the market.