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Ksh at its weakest since it floated in 1994
Rank: Chief Joined: 8/4/2010 Posts: 8,977
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ChessMaster wrote:hisah wrote:CBK tightens liquidity ahead of polls - http://www.businessdaily...6/-/lvk9nl/-/index.html
A desperate CB this one. No need to fight it trying to short the KES. They'll pull all the stops whichever way possible. I still do not advocate playing against the KES, stocks are a better bet. For me if the shilling weakens foreigner appetite increases.What are your thoughts? Orderly weakness doesn't spook markets. The opposite does and no investor wants to be caught up in such a storm. E.g. You invest $100,000 @KES80 then 4 weeks later the $ rate spikes to KES90 as the local currency experiences a run. No equity or bond market rallies in such an environment due to currency panic & disorderly fin markets and a panicky CB fighting the fin market. If lucky say that stock didn't selloff, you cash out and convert back to USD. You end up with less USD incurring a forex loss.
In 2011 when the CB managed to smoke out the madness by two huge CBR hikes, fx controls & liquidity controls in Nov, that was when foreign money got interested. $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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KPLC to be given the greenlight to hike tariffs. ERC to regulate - http://www.businessdaily...l/-/6iww3c/-/index.html Power hike = inflation rate rise This is a sad situation and is expected when you take loans from IMF/WB. Quote:While higher tariffs will hit consumers hard, it is expected to lift the fortunes of Kenya Power, which says rising operating costs is hurting its margins.
Managing director Joseph Njoroge said that new
tariffs would help the utility firm raise funds for
investment in electricity distribution network.
Higher revenue is also aimed at winning the
confidence of financiers like European Investment Bank and the World Bank on whom the company relies on to fund its large capital expenditure. $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Elder Joined: 3/2/2009 Posts: 26,328 Location: Masada
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hisah wrote:KPLC to be given the greenlight to hike tariffs. ERC to regulate - http://www.businessdaily...l/-/6iww3c/-/index.html Power hike = inflation rate rise This is a sad situation and is expected when you take loans from IMF/WB. Quote:While higher tariffs will hit consumers hard, it is expected to lift the fortunes of Kenya Power, which says rising operating costs is hurting its margins.
Managing director Joseph Njoroge said that new
tariffs would help the utility firm raise funds for
investment in electricity distribution network.
Higher revenue is also aimed at winning the
confidence of financiers like European Investment Bank and the World Bank on whom the company relies on to fund its large capital expenditure. If a certain coalition wins you can imagine!!! Portfolio: Sold
You know you've made it when you get a parking space for your yatcht.
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Rank: Member Joined: 2/8/2007 Posts: 808
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Duft move by all concerned. Who said KPLC must make top end profits? This single move if effected will push up inflation to past 12.5%. Most of the consumer goods and telecoms are powered by KPLC sourced power mainly. And then the vicious cycle will begin again......higher interest rates, no economic growth, pay agitation from all civil servants, redundancies in private sector, security will not necessarily improve and social unrest will slowly creep in. I mean is the GoK demented? You have to control inflation else you can stop talking about any economic growth or development in a free market economy. Even those who control prices in restricted economies do so to manage inflation. ARRRRRGGGHHHHH!!!
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Rank: Elder Joined: 6/2/2011 Posts: 4,818 Location: -1.2107, 36.8831
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CBK depleting foreign currency reserve FAAASSST Receive with simplicity everything that happens to you.” ― Rashi
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Rank: Elder Joined: 5/25/2012 Posts: 4,105 Location: 08c
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Quote:Figures indicate that these reserves decreased from $5.177 billion (equivalent to 4.06 months of import cover) as at January 24 to $4.959 billion (equivalent to 3.89 months of import cover) in the week ending January 31. The position has since deteriorated to $4.975 billion (equivalent to 3.79 months of import cover) as at February 7 to $4.960 billion (equivalent to 3.78 months of import cover) in the week ending February 14. Unquote Gutter Press. $4.975 B and $4.960 B are greater than $4.959 Pesa Nane plans to be shilingi when he grows up.
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Pesa Nane wrote:Quote:Figures indicate that these reserves decreased from $5.177 billion (equivalent to 4.06 months of import cover) as at January 24 to $4.959 billion (equivalent to 3.89 months of import cover) in the week ending January 31. The position has since deteriorated to $4.975 billion (equivalent to 3.79 months of import cover) as at February 7 to $4.960 billion (equivalent to 3.78 months of import cover) in the week ending February 14. Unquote Gutter Press. $4.975 B and $4.960 B are greater than $4.959 Expected of substandard paper.
Fighting a desperate CB is bad biz. KES shorts cant work in an illiquid market full of controls barriade. Interbank rate spike means CB is mopping KES as fast as possible. Fin markets thrive on liquidity. Pushing the $ beyond 90 in this environment is really tough.$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Good article - http://www.businessdaily...8/-/7cx3x9z/-/index.html$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Elder Joined: 6/2/2011 Posts: 4,818 Location: -1.2107, 36.8831
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Shilling at risk as reserve hits 8 months low Receive with simplicity everything that happens to you.” ― Rashi
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Rank: New-farer Joined: 1/4/2013 Posts: 22
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last time the reserves went below the 3.7 months import cover, and the market got wind of that news, the KeS took a massive hit. The CBK seems very vigilant this time round. i wonder how longer they can support the beloved KeS though Dum vivimus, vivamus.
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Rank: Member Joined: 9/29/2010 Posts: 679 Location: nairobi
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new wrote:last time the reserves went below the 3.7 months import cover, and the market got wind of that news, the KeS took a massive hit. The CBK seems very vigilant this time round. i wonder how longer they can support the beloved KeS though well short term rates up 400 pts since reserves went below 4 months of cover so attack the kes at ur peril...
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Power bills set for steep rise from next month - http://www.businessdaily...8/-/1jriyy/-/index.html
Upside down economics this. Rise power bills, rise medical insurance, rise mobile money excise duty, proposed VAT on essential foods, KE GDP 2012 misses target, KRA to miss target too, pressure on tbills, pressure still on KES, economy still begging for stimulus as per GDP miss etc. Economics KE upside down. I pray that elections are peaceful & global oil prices reverse. Those 2 combined if they merge, could throw the econ under the bus. NSE & bonds would be smashed in the process. $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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hisah wrote:Power bills set for steep rise from next month - http://www.businessdaily...8/-/1jriyy/-/index.html
Upside down economics this. Rise power bills, rise medical insurance, rise mobile money excise duty, proposed VAT on essential foods, KE GDP 2012 misses target, KRA to miss target too, pressure on tbills, pressure still on KES, economy still begging for stimulus as per GDP miss etc. Economics KE upside down. I pray that elections are peaceful & global oil prices reverse. Those 2 combined if they merge, could throw the econ under the bus. NSE & bonds would be smashed in the process. Good opinion - www.nation.co.ke/oped/Op...1/-/n89smnz/-/index.html
I hope the biz lobby drives the expensive power issue home during the ERC stakeholders meeting. Just like the mobile money tax, this power hike is another bogus move. Thinking deficiency at large by policy makers. But KPLC having taken loans from world bank and friends, that's the nuisance you get for trading with the vultures.
Githae will be long gone when the new FinMin checks in. Inflation will be his/her greatest headache as well as that wide current account deficit. Also pending is that IMF proposed VAT bill that touches essential food stuff. More inflation. The only way out and @guru should remember this, IMF & friends will insist that the inflation model is revised to yet again hide inflation like in 2010. When that happens I'll short again KES like in 2011...
Btw last week the Bulgarian govt was forced to resign by civil protest against power hikes. Bulgaria is in an econ slump and that power hike just did it for the citizenry.
$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Kenya inflation rises to 4.45% - http://www.theeastafrica.../-/kvrm68z/-/index.html
Quote:Kenya’s prices of goods rose at a faster pace in February for the second consecutive month on account of higher milk, beef and fuel costs, the statistics bureau said on Thursday.
The Kenya National Bureau of Statistics (KNBS) said inflation in February rose to 4.45 per cent compared to 3.67 per cent in January this year. In December last year, prices of basic goods and services rose at 3.2 per cent, the slowest pace after the inflation rate declined for 13 consecutive months. Not good for an econ still in the slump and badly needing stimulus. On the other hand KES is putting up a big fight with the USD while T-bills rate also keep creeping up and NSE is also up. Big fight standoff... Mixed signals. $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Veteran Joined: 4/30/2010 Posts: 1,635
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Rank: Veteran Joined: 2/3/2010 Posts: 1,797 Location: Kenya
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Shilling strengthens after ElectionsFUNKY wrote:http://www.businessdailyafrica.com/Kenyan-shilling-hits-2013-peak-ahead-of-vote/-/539552/1707286/-/rn8k1v/-/index.html I may be wrong..but then I could be right
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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Today the USD is up 1% plus to put the rate at 86.50 as the wait and see atmosphere thickens... $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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I'm waiting for the KES action. It'll be lovely... $15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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Rank: Member Joined: 9/29/2010 Posts: 679 Location: nairobi
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hisah
very boring market, in 2008 during PEV time the action was amazing, this time price action is boring or maybe ive been in this business for too long..
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Rank: Chief Joined: 8/4/2010 Posts: 8,977
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kizee1 wrote:hisah
very boring market, in 2008 during PEV time the action was amazing, this time price action is boring or maybe ive been in this business for too long.. Yep. In 2008 it was action packed compared to know.$15/barrel oil... The commodities lehman moment arrives as well as Sovereign debt volcano!
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