NAIROBI: The Kenyan shilling was barely changed against the dollar on Thursday while shares of media firms fell ahead of their earnings reports for last year, dragging the benchmark index slightly lower.
At the 1300 GMT close of trade, leading commercial banks posted the shilling at 86.45/55 per dollar, barely moved from Wednesday's close of 86.55/65.
Traders said the effect of excess liquidity in the market on the shilling would be limited, since the yield on holding shillings overnight was still relatively higher than holding dollars.
"It's pure demand and supply for now. Unless I get demand from customers, I am better off earning 6 percent on shillings, rather than earning 0.1 percent on dollars," said a senior trader at one commercial bank.
The weighted average interbank lending rate fell to 5.9712 percent on Wednesday from 6.7704 percent a day earlier, pointing to increased shilling liquidity.
The central bank mopped up 10 billion shillings in 7-day repos from the market during the session at a weighted average interest rate of 6.368 percent.
It was the bank's second intervention in as many days.
In the stock market, the benchmark NSE-20 share index inched down by 0.13 percent to 4896.40 points, weighed on by some of the blue chip firms on the index.
Shares in Nation Media edged down by a third of a percentage point to close at 315 shillings each ahead of its full year earnings report expected next week.
Eric Musau, a research analyst at Standard Investment Bank, said investors were concerned by the likely impact of an impending move to digital broadcasting from analogue.
"There is that concern in regards to their profitability and whether the main players can actually maintain their competitiveness," Musau said.
Digital broadcasting will lead to households having access to much more channels, thus offering stiffer competition to existing broadcasters such as Nation Media's NTV.
In the debt market, bonds worth 1.39 billion shillings were traded, up from a traded volume of 1.1 billion shillings in the previous session.
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