Central Bank seeks to mop up Sh9 billion

The Central Bank sought to soak up Sh9 billion in excess liquidity from the market yesterday using repurchase agreements. Traders had expected the shilling to come under pressure from the dollar due to a surge in liquidity that could make it slightly cheaper to fund long dollar positions. The weighted average interbank rate fell to 11.2 percent on Friday, from 13 percent on Thursday, mainly due to redemption of government debt that has matured. At 0706 GMT, commercial banks posted the shilling, which has been hemmed in a tight range of 84.10-84.40 in the past week, at 84.15/25 per dollar, barely changed from Friday's close of 84.15/35.