NAIROBI: The Kenyan shilling was treading water against the dollar on Tuesday and looked likely to stay in a tight range in coming days as the market expects the central bank would step in to keep it from appreciating, traders said.
At 0715 GMT, commercial banks quoted the shilling at 87.75/85 to the dollar, unchanged from Monday's close.
"It's going to be range bound for now," said Andlip Nazir, senior trader at I&M Bank.
Traders forecast a range of 87.50-88 for the next few days. Nazir expects an even tighter range between 87.60-90 and said Kenya's central bank is likely to intervene again if the shilling tests the 88 level.
"We don't see the shilling going above 88 as it's being protected by the central bank," he added.
The central bank is seen wanting to keep the currency relatively stable and has recently step in to keep it from appreciating beyond 88 to the dollar.
The shilling has weakened by about 1.8 percent against the dollar this year as tourism, a major foreign exchange earner for Kenya, has been hit by a series of attacks on the country, blamed on Somali militant group al Shabaab.
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