NAIROBI: Kenya's shilling weakened on Thursday, undermined by dollar demand from energy and manufacturing sectors but traders said it was seen stable on dollar inflows targeting a bond sale.
At 0930 GMT, commercial banks quoted the shilling at 92.65/92.75 to the dollar, from Wednesday's close of 92.50/92.60.
"There's been good corporate demand from firms in energy, oils and manufacturing sectors," said a trader at a leading commercial bank.
Traders say most firms are keen to settle their bills as banks and most businesses will be closed on Friday and Monday for public holidays.
Duncan Kinuthia, head of trading at Commercial Bank of Africa (CBA) said the local currency would likely trade in a range between 92.10-92.90 against the dollar next week.
Traders say an upcoming infrastructure bond should lend support to the shilling. Kenya's central bank has invited bids for a 12-year infrastructure bond worth up to 25 billion shillings ($271 million) in a tap sale.
Traders said the shilling, which is down 2.6 percent against the dollar so far this year, has also been receiving support from regular central bank liquidity mop ups. Draining liquidity makes it more expensive for banks to hold dollar positions.
Kenya's central bank said on Thursday it planned to mop up 24 billion shillings in excess liquidity from the money markets.
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