Shilling seen range-bound on low dollar demand

Kenya’s shilling was unchanged in early trade on Friday, with little demand for dollars from corporate buyers while inflows of foreign exchange remained weak. By 0715 GMT, commercial banks quoted the shilling at 102.15/25 to the dollar, the same as Thursday’s close. “There is no demand, no supply, and no activity at all,” said one Nairobi-based trader, adding that the currency was likely to stay around the 102.10 and 102.30 range into next week. Kenya’s central bank held its benchmark lending rate at 11.50 percent on Tuesday, saying the exchange rate had stabilised and the current account deficit had narrowed. The move helped stabilise the local currency, traders said. The shilling, down more than 11 percent against the dollar this year, has been under pressure partly because of global dollar strength and partly because of domestic issues, such as a hefty trade gap and budget deficit.