Kenyan assets tread water ahead of budget speech

NAIROBI, Kenya: The shilling was barely moved against the dollar on Monday while the benchmark share index was also little changed as markets awaited the national budget speech later in the week.

At the 1300 GMT close of trade, leading commercial banks posted the shilling at 87.55/65 per dollar, barely changed from
Friday's closing rate of 87.45/55.

"For now we will stick to the 87.20-70 range as we focus on the budget and the Eurobond for direction," said a trader with a
leading commercial bank.

Finance Minister Henry Rotich is scheduled to present the government's budget for the fiscal year starting on July 1 to parliament on Thursday. His speech will include the latest guidance on growth, inflation and borrowing projections.

Traders said if Kenya secures strong demand for its debut Eurobond, which it is now marketing to
investors abroad, the shilling could get a boost.

"We could see a knee-jerk reaction (to the success of the Eurobond). We should see the shilling initially appreciate,"
said a trader.

On the stock market, the main NSE-20 share index inched down by a quarter of a percentage point to close at
4,835.69 points as investors also cast their eyes towards the budget speech.

"We are just waiting for the budget to see if there will be anything that will affect the markets," said Eric Musau, a
research analyst at Standard Investment Bank.

Musau said share prices of some firms could be move if the minister introduces new taxes on products like cigarettes in the
budget to raise revenue .

There were no trades on the debt market during the session,
the Nairobi Securities Exchange said.