NAIROBI: The Kenyan shilling held steady on Monday and was expected to be lifted in coming days by dollar inflows from Kenyans working abroad as importers wind down their orders before the holidays.
At 0738 GMT, the shilling traded at 86.05/15 per dollar, barely changed from Friday's close of 85.95/86.15.
"I would expect the shilling to strengthen by the end of the week as corporates close for the holidays," said Julius Kiriinya, a trader at African Banking Corporation.
"Diaspora remittances and the central bank mopping liquidity is still supporting the shilling."
The shilling, which is down 1 percent against the dollar in the year to date, is seen trading in the 85.80-86.20 range in coming sessions.
The local currency has been supported by the central bank's efforts to support the shilling by mopping up extra supplies of the local currency from the banking sector with its market operations this year.
The bank maintained very high lending rates in the first half of this year to fight inflation but has reduced rates steadily since July while regularly sucking up liquidity using repurchase agreements.
"We still expect inflows from tourism, NGO's (aid agencies), and Diaspora remittances to support the shilling as demand begins to slow," Bank of Africa said in a daily report.
Tourism and remittances are a key source of hard currency for the east African nation and the two sectors generated combined revenues of more than $2 billion in 2011.
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