NAIROBI: The Kenyan shilling weakened on Monday, hurt by fears that the ailing tourism sector, a key source of hard currency, could be damaged further after weekend attacks along the country's Indian Ocean coastline.
At 0730 GMT, commercial banks posted the shilling at 89.45/55, slightly weaker on Friday's close of 89.40/50.
"Security concerns are what has made the shilling weaken slightly," said Eric Gathecha, a trader at I&M Bank.
Kenyan soldiers on Sunday shot dead six suspected members of a separatist group after they hacked an officer to death in an attack on barracks in the port city of Mombasa. A day earlier officers fought off armed men at a police station in Malindi, a tourist resort north of Mombasa.
Insecurity plagues the East African country and attacks in recent years on the coast and in the capital have prompted Western nations to issue travel warnings, hitting the tourist industry, a big contributor to the economy.
The shilling has been under pressure for much of the year largely because of a sharp drop in tourist arrivals, due to a series of Islamist attacks on the coast and elsewhere.
The central bank supported the currency by selling dollars last month when the shilling reached the 89.50 mark.
Gathecha said the shilling has also come under pressure from a strengthening US dollar, which on Monday powered to a seven-year peak against the yen and a two-year high on the euro.
Comments
Comments are closed for this article.