NAIROBI (Reuters) - Kenya's shilling traded at a new all-time low of 91.90 to the dollar on Wednesday, continuing its losing streak in a market starved of liquidity, traders said.
At 0657 GMT, commercial banks quoted the shilling at 91.70/90 to the dollar, from Tuesday's close of 91.45/95 against the dollar.
Traders said the market was seeing trades quoted at spreads of as high as 50 cents.
"There's actually a wide spread. Looks like liquidity is low when it comes to the trading, we are talking about both the dollar and the shilling. If you look at it in terms of the size of deals, people are actually quoting in quarters," said Solomon Alubala, head of trading at Co-operative Bank.
"For now I think the risk is still on the upside, but it's highly unpredictable."
Kenya's central bank is ready to take corrective action to ensure that the inter bank foreign exchange market is driven by events and fundamentals at all times, rather than speculation, the governor said on Wednesday.
Technical analysis of the graphs of the 14-day and 50-day simple moving averages show the shilling is expected to stay on a weakening trend in the short term.
Chris Amiga, a senior trader at Kenya Commercial Bank said there were indications the export sector was beginning to inject money into the system.
"Liquidity is coming back into the market ... predominantly from exporters. There was a bit of tea selling and the NGO (non-governmental organisations) have been quite busy," said Amiga.
"Importers have been on the sidelines, they're a bit uneasy about the levels right now."
