The Kenyan shilling weakened against the dollar on Monday on energy sector importers buying greenbacks to meet their end-month obligations, and traders said they expected the local currency to weaken further over the short-term.
On the Nairobi bourse, the key NSE 20-Share index was barely changed, inching down by just 0.2 per cent to 3,176.36 points, dragged by market heavy weight, Safaricom.
The mobile provider, which is among the biggest capitalised stocks on the bourse, fell 3 per cent to 3.20 shillings as local investors took gains after a recent rally.
The shilling is 2.5 per cent firmer this year helped by open market operations by the central bank, which have mopped out 40.33 billion shillings ($485.61 million), and offshore dollar inflows drawn by high domestic interest rates.
At the market close, commercial banks quoted the shilling at 83.25/89.45 against the dollar, weaker than on Friday’s close of 82.90/89.10.
“We saw a bit of demand from the energy guys. Importers are lining up greenback orders to meet their end month needs,” said Robert Gatobu, a trader at Bank of Africa. Traders said that although the shilling could weaken further a slide would be short lived.