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Shilling drops to eight-week low against the dollar

Reuters has attributed the depreciation to high dollar demand from the energy sector

In Summary

•The drop comes barely two weeks after it defied doom predictions by financial experts to trade below Sh100 mark.

•On March 7, it rose to a four-year high of 99.80 against the dollar.

Central Bank CBK Headquarters.Photo/File
Central Bank CBK Headquarters.Photo/File

The Kenyan shilling today averaged 100.85 against the dollar, sinking to an eight-week low.

Reuters has attributed the depreciation to high dollar demand from the energy sector, outweighing dollar supply from horticultural exports.

The drop comes barely two weeks after it defied doom predictions by financial experts to trade below Sh100 mark against the greenback.

The shilling closed 99.80 against the dollar on March 7, a four-year high.

The shilling has maintained stability against the dollar since November last year, backed by steady inflows from diaspora remittances and improved microeconomics.

In January, CBK projected the shilling to continue to stabilise against major currencies on lower import cover.

Last year, the International Monetary Fund challenged the growth of the Kenyan currency, saying it was overvalued by 17.5 percent.