Shilling at one-month highs, buoyed by high T-bill yields

Kenya’s shilling was trading at its strongest level in a month early on Thursday, helped by rising yields on government securities and weak corporate demand for dollars. By 0733 GMT, the shilling was quoted at 104.20/40 to the dollar, compared with Wednesday’s close of 104.55/75.

“The shilling is getting stronger. This is due to lack of liquidity and rising yields in government securities that is going to attract a lot of offshore investors,” said one senior dealer at a commercial bank. Yields on Kenya’s 182-day Treasury bills jumped to 20.695 percent at Wednesday’s auction from 16.301 a week earlier, while yields on 182-day bills shot up to 20.331 percent from 14.551 percent.