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UPDATE 1-Kenyan shilling steady on tight liquidity, stocks inch down
July 28, 2014 / 2:50 PM / in 3 years

UPDATE 1-Kenyan shilling steady on tight liquidity, stocks inch down

(Adds markets close, stocks)
    By George Obulutsa
    NAIROBI, July 28 (Reuters) - The Kenyan shilling 
closed steady on Monday and traders said they expected it to
strengthen due to tight liquidity in the money markets, while
stocks nudged lower.
    At close of trade at 1300 GMT, commercial banks quoted the
shilling at 87.70/80 to the dollar, compared with Friday's
closing rate of 87.65/75.
    Traders said the shilling was expected to strengthen due to
tight liquidity in the money markets.
    Dwindling liquidity pushed the weighted average interbank
lending rate to 8.1248 percent on Friday from 7.8308 percent a
day before, on volumes of 23 billion shillings ($262.41
million).
    Nahashon Mungai, trader at KCB Bank Group, said commercial
banks had used the central bank's discount window on Friday -
another indication of the tightening liquidity. The banks
borrowed about 3.8 billion shillings even though the central
bank's borrowing rate is 14.50 percent rate, Mungai added. 
    "Liquidity is rather tight. I would say the liquidity
situation is pretty dire, so I expect the shilling to be
well-supported in the coming days," he said.
    Earlier, Commercial Bank of Africa trader John Njenga said
there was some demand, mainly from oil firms and manufacturers
but that, barring any unforeseen events,the shilling was likely
to stay in its recent tight range of 87.50-88.00.
    Worries over frequent gun and grenade attacks blamed on
Islamist militants have limited the shilling's gains this year,
while the central bank has signalled it will not let it fall
past 88.00 by pumping in dollars whenever it nears that level. 
    On the Nairobi Securities Exchange, the main NSE-20 Share
Index was down 15.22 points, or 0.3 percent, closing at
4,863.87 points.
    Telecoms firm Safaricom helped lead the index
lower, ending the session down 1.6 percent on profit-taking.
    "For Safaricom ... it's a trend that started picking up
sometime last week. It's more of investors cashing in on capital
gains ... (there's) nothing specific in it," said Agnes Achieng,
research analyst at Sterling Investment Bank.
    Government bonds valued at 1.04 billion shillings were
traded in the secondary market, compared with 2.79 billion
shillings on Friday.
               ...........................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
  SPEED GUIDES:
                                    
            
 
($1 = 87.6500 Kenyan Shillings)

 (Additional reporting by Duncan Miriri; Editing by Catherine
Evans)

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