This archive report was first published on 6 October 2019.
On October 4, 2019, the Kenyan shilling closed on a stronger footing against the US dollar, thanks to diaspora remittance inflows.
According to Reuters, a decrease in dollar demand from energy sector players contributed to the shilling's gain. Energy sector players, known for their significant impact on the exchange rate due to their large purchases, had reduced their dollar buying activity.
Commercial banks quoted the shilling at an average of 103.80 in afternoon trading on Friday, having opened the week at an average of 103.89 units.
Commercial Bank of Africa noted in a market report on October 4, 2019, that 'dollar supply sufficiently met demand from the manufacturing sector … dollar buyers retreated to the sidelines, tipping the scales in favour of the local unit to close on the front foot albeit marginally.'
Business people predict that the shilling will continue trading in a tight range against the dollar in the coming week, absent any market-shaking news. The Central Bank's willingness to mop up liquidity has also contributed to the shilling's stability.
