The US Dollar to Kenyan Shilling exchange rate was trading in the region of 87.35 KES as of 11:55 am GMT
Coffee. It keeps you awake, goes great with a croissant and apparently causes the Kenyan Shilling to rise.
According to the Nairobi Coffee Exchange a weekly coffee auction has netted Kenya 1.05 million Dollars. An unidentified central bank official also stated that the Central Bank of Kenya chose to offer 5 billion Kenyan Shillings (or 57 million US Dollars) of seven day repurchase agreements.
This type of action is taken by the bank in order to lend support to the Shilling through a reduced money supply. So far this year the Central Bank of Kenya has swallowed up 113 billion Shillings from the market.
Solomon Alubala, the National Bank of Kenya’s head of trading, commented ‘The Shilling has received support from the inflow of Dollar’s from the coffee auction at a time when demand for Dollars is subdued. The central bank’s persistent removal of money from the market has created a liquidity crunch supporting the Shilling further.’
After these developments the Kenyan Shilling rose to its highest level for almost nine days against the US Dollar.
In other African currency news, the Tanzanian Shilling also gained slightly on the US Dollar whilst the Ugandan Shilling recorded a modest decline against its American currency rival.
This afternoon’s US advance retail sales data is broadly expected to show growth of 0.1 per cent, to add to December’s increase of 0.5 per cent. If the improving job market in America leads to this figure coming in above expectations the US Dollar could strengthen and climb against several of its most traded currency peers in the hours ahead.
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