Kenyan shilling in sharp fall as dollar demand swells

NAIROBI, May 23 (Xinhua) -- The Kenyan shilling declined considerably against the U.S. dollar on Wednesday overwhelmed by a huge demand for the greenback by importers.

The local unit traded to the dollar at an average of 100.90, a huge decline from 100.60 in the session on Tuesday.

Commercial banks quoted the currency at between 100.90 and 101.10, with the margins rising from 100.50 and 100.60 on Tuesday.

On the other hand, the Central Bank of Kenya placed the shilling at a stronger position of 100.80 from 100.64 per dollar in Tuesday session.

Currency traders attributed the decline to huge demand for dollars by manufactures and oil dealers amid low inflows.

Against the British pound, the shilling similarly declined to end Tuesday at 135.42, down from 134.95.

The Central Bank has 9.1 billion dollars forex reserves, which it can use to intervene in case the shilling falls further. However, analysts noted the decline is within acceptable margins. Enditem