Kenyan shilling stable, seen supported by high debt yields

by Reuters 0

Kenya’s shilling was little changed on Monday with foreign investor inflows, driven by high government debt yields, supporting the local currency.

At 0725 GMT, commercial banks quoted the shilling at 101.95/102.05 to the dollar, little changed from Friday’s close of 101.90/102.10.

The shilling has firmed in recent weeks due to inflows of dollars from offshore investors chasing government debt. Yields on the benchmark 91-day paper slipped at last week’s auction to 19.471 percent but remain far above normal levels.

“Based on current yields, the shilling should stay supported,” said one Nairobi-based trader.

Yields on the 182 and 364-day Treasury bills were above 21 percent at last week’s auction.