Kenyan shilling weakens due to increased FX demand, Moody’s downgrade

NAIROBI: Kenya’s shilling weakened on Wednesday, pressured by increased foreign-currency demand and a credit rating downgrade by Moody’s, traders said.

At 0800 GMT, commercial banks quoted the shilling at 128.25/129.25 per dollar, compared with Tuesday’s closing rate of 127.75/128.75.

Moody’s pushed Kenya’s sovereign rating deeper into junk territory on Monday, citing the country’s diminished capacity to implement a fiscal consolidation strategy after the president withdrew planned tax hikes in response to mass protests.

Kenyan shilling firms to new 1-year high

Traders said the higher foreign-currency demand was mainly coming from the manufacturing sector and general goods importers.