THE shilling was steady against the dollar early yesterday as trading activity thinned ahead of the holidays, and was expected to remain subdued in coming sessions.
At 0728 GMT, commercial banks quoted the shilling at 86.00/20 per dollar, a level it has held at for the past two sessions. "There a bit of slowdown in activity as corporates close for the holidays," said Duncan Kinuthia, head of trading at Commercial Bank of Africa.
"In this kind of situation any big order could move the market significantly. But we don't expect that will happen." The shilling looks set to end 2012 little changed, having fallen 1.1 per cent against the dollar so far this year, supported by central bank efforts to keep supply in check via repurchase agreements.
The bank soaked up 6.57 billion shillings ($76.4 million) on Tuesday, receiving bids of 7.425 billion shillings for the 8 billion it had offered in repos. "The central bank has been keen to mop up liquidity every time the shilling comes under pressure," Kinuthia said.