NAIROBI: The Kenyan shilling edged down against the dollar on Thursday, though traders said they saw signs of the currency strengthening in the coming days with more dollars coming into the market. Stocks were up.
At the 1300 GMT close, banks quoted the shilling at 91.70/80 to the dollar, weaker than Wednesday's close of 91.60/70.
"It's staying with the trend of weakening," said Duncan Kinuthia, head of trading at the Commercial Bank of Africa. "However, we've started seeing improved dollar inflows, and some customers looking like they would like to sell forward. With all this, we may see the shilling gain."
Export businesses have already begun to sell dollars, perhaps to hedge against a correction in the shilling, he said.
The shilling has for weeks been hovering around levels not seen since November 2011.
"The pressure is coming from a build-up of (dollar) demand and right now the supply side is quite wanting... tourism is muted and that is quite a challenge," said Chris Muiga, trader at National Bank.
Hard currency inflows from tourism - a leading foreign exchange earner for East Africa's biggest economy - fell last year after a series of gun and grenade attacks, blamed on Islamists from neighbouring Somalia, scared off tourists.
On the equity market, the benchmark NSE 20 index inched 0.25 points higher at 5,172.88 points.
In the debt market, bonds worth 207 million shillings ($2.26 million) were traded, down from 1.79 billion shillings on Wednesday.
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