Kenya shilling unchanged against dlr, could weaken

NAIROBI, June 10 (Reuters) - The Kenyan shilling KES was stable against the dollar on Tuesday but dealers saw it weakening in coming days due to expected local currency flows linked to East Africa's biggest share sale.

At 1000 GMT, commercial banks quoted the unit at 63.45/55, unchanged from Monday's close.

The IPO in mobile phone operator Safaricom (SCOM.NR) was oversubscribed by 532 percent, so the government now has to return billions of shillings to investors.

"There is not much activity in the market as people are waiting for refunds from Safaricom," said a dealer at African Banking Corporation.

"Refunds from Safaricom might give direction to the dollar."

Dealers said the local unit would be under pressure from importers seeking dollars to make payments coupled by the influx of shillings from the share flotation.

"We expect the dollar to remain firm during the week as investors are taking their money back and as corporates take up profits," said Stephen Lagat, a dealer at CFC Stanbic Bank.

KES= KES1=............Shilling spot rates

KES= KES1=............Shilling spot rates

KESF=...............Shilling forward rates

EURKES= KESX=.Cross rates

<KE/CONT1=>............All Kenya Contributors

CBKINDEX........Central Bank of Kenya Index

<KE/DEBT>......Kenyan Bonds contributor pages

CBK03 CBK06 KE3MTB=.Treasury bill yields