Shilling expected to stabilise post-election

A teller counts Kenya shilling notes inside the cashier's booth at a forex exchange bureau in Kenya's capital Nairobi

The Kenya shilling is expected to shake off some pressure as investors stay on the market sidelines pending the final outcome of the presidential election.

In Wednesday’s trading, commercial banks quoted the shilling at 103.95/104.05 per dollar, compared with 103.75/95 at last Thursday’s close.

“Our clients in the industrial sector stayed out... if results are announced and taken well, we could see appreciation of the shilling,” said a trader from a leading commercial bank.

Results that have yet to be confirmed by the electoral agency show incumbent President Uhuru Kenyatta leading, but his rival, Raila Odinga, has challenged the outcome, alleging fraud.

Elsewhere, the Ugandan shilling is seen trading in a broadly stable range on the back of waning demand and easing fears about the possibility of widespread election-related violence in Kenya.

Commercial banks quoted the shilling at 3,605/3,615, stronger than last Thursday’s close of 3,612/3,622.

Faisal Bukenya, head of treasury at Exim Bank Uganda, said demand from importers was expected to remain subdued. Fears about the possibility of post-poll violence in Kenya “are also easing gradually”, he said.