Kenyan shilling steady, shilling liquidity may exert pressure

Kenya’s shilling was today, Fridaysteady but could face pressure from extra shilling liquidity that has been pushing down overnight lending rates, traders said.

Commercial banks quoted the shilling at 102.15 to the dollar, unchanged from Thursday’s close.

“We continue to see that market liquidity is high, which now makes the cost of funding lower. If you look at the overnight rates, they have continued to dip,” said one trader.

The trader said investors were looking ahead to the central bank’s Monetary Policy Committee meeting on Jan. 20 to see what would happen to the main lending rate, now set at 11.50 percent.