UPDATE 1-Kenyan shilling weakens on corporate dollar demand

Wed Mar 5, 2014 10:15am EST

Related Topics

* Central bank intervenes to mop up liquidity
    * Dollar demand from energy sector, manufacturers -dealers
    * Shares in Diamond Bank fall 3.8 percent

 (Adds shares, closing rate)
    By Drazen Jorgic
    NAIROBI, March 5 (Reuters) - The Kenyan shilling 
weakened on Wednesday on strong dollar demand, which caused the
central bank to mop up excess liquidity, while the benchmark
share index inched lower.
    Leading commercial banks quoted the shilling at 86.55/65 at
the 1300 GMT market close, against Tuesday's close of 86.35/45.
    In a rare move this year, the central bank mopped up 10
billion shillings ($116 million) through repurchase agreements,
saying there was excess liquidity in the market.
    Andlip Nazir, senior trader at I&M Bank, said the bank's
intervention was countered by strong corporate demand for
dollars from the manufacturing and energy sector.
    "With this kind of dollar demand, and not very good inflows,
we expect the market to gradually move towards 87," Nazir said.
    The weighted average interbank lending rate dropped to
6.7704 percent on Tuesday from 7.7604 percent a day before.
 
     The Nairobi Securities Exchange's benchmark NSE-20 share
index slipped 0.1 percent to close at 4,902.72 points.
    In the banking sector, which accounted for about a third of
the day's trade, Diamond Trust Bank fell 3.8 percent to
225 shillings a share after it secured shareholder approval to
increase capital, a move that could dilute its share value.
    In the bond market, securities worth 1.1 billion shillings
were traded, down from Tuesday's volume of 1.4 billion.    
               ...........................Shilling spot rates
                  .....................Shilling forward rates
                           .......................Cross rates
         ..................................Local contributors
           .......................Central Bank of Kenya Index
          .....................Kenyan Bonds contributor pages
                          ...............Treasury bill yields
        ..................Central bank open market operations
        .........................Horizontal repo transactions
         ,       ................Daily interbank lending rate
              .............................Kenya Bond pricing
             ..................Real time Africa economic data
 <ECI & AFR> ...........................African economic news
          .................................NSE-20 Share Index
         .................................NSE All Share Index
             ...........................FT NSE Kenya 15 Index
             .......................... FT NSE Kenya 25 Index
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 (Additional reporting by George Obulutsa; Editing by Louise
Ireland)
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