Trade in Kenya’s foreign exchange and stock markets was slow and volumes thin on Friday, as fears of more post-election violence kept many dealers at home.
”There’s not much activity. Most players are out,” said Bank of Africa forex dealer Robert Gatobu. ”It’s a wait-and-see attitude with players waiting for the political climate to calm down.”
On Thursday, the currency market and stock exchange were forced to halt trade as police fought opposition supporters trying to stage a rally over President Mwai Kibaki’s disputed win.
Market players were braced for more trouble on Friday after the opposition threatened to defy police for a second day running by holding a rally in Nairobi’s main park, bordering the central business district.
However, by midday the rally appeared to falter, giving Kenya some respite from the turmoil that has hurt the country’s crucial tourism, tea and coffee sectors, and sparked regional fuel shortages.
The currency market was not posting prices on the inter-bank to avoid exaggerated losses by the shilling, one forex dealer said.
”The market opened as normal, but we will not be on the inter-bank to avoid exaggerated depreciation while we monitor the situation,” he said. ”If things calm down, we may resume inter-bank trade next week, but trade today [Friday] will be in-house.
Offshore trade in the shilling fluctuated sharply on Thursday after the Kenyan currency lost 5% against the dollar in the previous session.
There was cautious trading in the Nairobi Stock Exchange.
”The market is still open, but volumes are low,” said one broker.
The International Monetary Fund’s (IMF) managing director, Dominique Strauss-Kahn, added to a chorus of concern over the political unrest in Kenya, East Africa’s biggest economy.
”I very much hope that the political leaders in Kenya will quickly and peacefully resolve the current dispute over the election results,” he said in a statement. ”This would open the way to further progress toward economic prosperity.” — Reuters