Shilling opens at Sh84 in Tuesday trading
Posted Tuesday, September 25 2012 at 10:55
- Forex dealers expect the shilling to come under pressure from oil marketers demanding dollars to meet their end month import obligations.
The Kenyan shilling opened trading Tuesday at Sh84.80 against the dollar, remaining largely unchanged from Monday’s average close of Sh84.85.
Forex dealers, however, expect the shilling to come under pressure from oil marketers demanding dollars to meet their end month import obligations.
The Nairobi Securities Exchange (NSE) began Monday on a low note as equity turnover slipped by 40 per cent due to reduced foreign investor activity, which accounted for 41 per cent of trades compares down from 57 per cent previously.
The NSE 20 Share Index went up slightly by 0.38 per cent to close at 3942.4 points yesterday.
KCB, which accounted for 37 per cent of the turnover, was the most active counter of the day.
On the fixed income segment, Bond turnover fell by 78.8 per cent in yesterday’s session to Sh611.7 million ($7.21 million).
Analysts at Old Mutual expect mixed performance in subsequent T-bills auctions due to stiff liquidity in the money markets given the rising interbank rates and volumes.
“We expect mixed performance following taut liquidity in the market as witnessed by the steadily rising interbank rates and volumes, under subscription on the repo auctions as well as low performance rate on the T-bill auctions,” the analysts said in a daily report.
On Friday last week, the average interbank rate stood at 6.81 per cent against 6.52 per cent the previous week.
The analysts further said that the liquidity condition the market worsened due to the 15 year paper auction that saw the government mop up Sh19.5 billion from the market.
Last week, the Central Bank of Kenya (CBK) absorbed Sh22.8 billion from the market compared to Sh33.8 billion it mopped up in the previous week.
“We expect reduced volumes on the repo market going forward as the liquidity situation continues to squeeze. In the coming week, we expect repo maturities worth Sh24.4 billion while the T-bills redemptions would amount to Sh5.8 billion,” the analysts further said.