CRDB Bank said in market highlights that overall the pair was quite stable during the year that just ended with very minimum price fluctuations. “We anticipate similar stability during the New Year 2018,” CRDB said in market highlights.
The traders’ sentiments were driven by the fact that last year the shilling volatility band was very narrow since in many occasions there were match demand and supply. “Dollar inflow into the market is expected to be sufficient to cover demand,” CRDB said.
The bank added the demand will be subdued by major suppliers of the foreign currency—commodity exporters and the tourism sector. “…While demand is expected to come from the manufacturing sector and oil and gas importers,” the bank said.
However, the shilling opened this year trading at very high note despite to fluctuate insignificant last year. The shilling yesterday was quoted by commercial bank, trading at the range of 2,225/- and 2,250/- throughout the market session with very little price volatility.
In comparison in the same day last year the shilling was trading around 2,185/- compared to 2,165/- of 2016. Traders pegged their shilling stability hope to increase of forex inflow. BoT latest report showed the overall balance of payments improved to a surplus of 1,773 million US dollars of last September compared to 164.5 million US dollars recorded in September 2016.
The improvement was largely driven by the increase in inflows in the form of grants and external borrowing, coupled with narrowing of current account deficit. Services account recorded a surplus of 1,739.7 million US dollars compared to a surplus of 1,121.4 million US dollars in September 2016, largely on account of a decline in services payments.
While, earnings from services amounted to 3,681 million US dollars up from 3,457.4 million US dollars following increase in travel and transport receipts. Earnings from travel, which is dominated by tourism, rose to 2,140.0 million US dollars from 1,980 million US dollars because of increase in the number of tourist arrivals.
On the other hand, transport receipts rose by 4.8 per cent to 1,085.3 million US dollars last September.
SOURCE: DAILY NEWS
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