NAIROBI: The Kenyan shilling slipped against the dollar on Thursday, primarily because of energy sector importers' need for the US currency, while shares inched up for a second straight session.
At the 1300 GMT close of the market, commercial banks posted the shilling at 84.00/20 per dollar, weaker than Wednesday's close of 83.80/84.00.
"There was some light (dollar) demand from the energy guys, particularly oil and power," said Peter Mutuku, a senior trader at Bank of Africa.
In the money markets, an increase in liquidity as banks cut short dollar positions dragged the weighted average interbank rate lower to 13.9 percent on Wednesday from 14.1 percent the previous day.
That caused the central bank to mop up 3.68 billion shillings ($43.94 million) from the market on Thursday, all the bids it received for its 4.5 billion shilling offer of seven-day, 14-day, 21-day and 28-day repurchase agreements (repos).
The shilling has been fairly stable this year, supported by the central bank's tight monetary policy, but the bank cut its benchmark rate this month to shore up economic growth, which could undermine the shilling.
At the Nairobi Securities Exchange, the benchmark NSE-20 Share Index gained 0.2 percent to close at 3,802.96 points, lifted by investors taking positions ahead of companies' half year financial results.
"The market is expected to rise as we enter into the half year reporting season where speculators will be looking to cash in on expected improved profitability," said Ronald Lugalia, an analyst at Afrika Investment Bank.
Shares in cement maker, Bamburi, rose 3.5 percent to close at a near 12-month high of 176 shillings each as investors bet that its half year results would be good due to higher demand for cement as the government rolls out ambitious infrastructure projects.
In the debt market, government bonds worth 1.7 billion shillings were traded, down from 2.4 billion shillings worth of securities traded on Wednesday.
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