NAIROBI, Sept 4 (Reuters) - The Kenyan shilling weakened to a two-month low against the dollar on Tuesday, breaking through the 84.50 resistance level as banks and importers bought greenbacks in anticipation of a large rate cut by the central bank. At 0642 GMT, commercial banks quoted the shilling at 84.60/70 per dollar, a level last touched on July 6, and 0.4 percent weaker than Monday's close of 84.20/40. Traders said the local currency was expected to weaken further ahead of Wednesday's interest rate decision by the central bank's Monetary Policy Committee (MPC). "A bit of client activity since late yesterday triggered interbank short covering. The shilling could touch 85.00 easily even before the MPC decision comes out," said Duncan Kinuthia, head of trading at Commercial Bank of Africa. A Reuters poll of nine analysts and traders returned a consensus forecast of a 300 basis point cut in the central bank rate after year-on-year inflation fell sharply in August to 6.09 percent, the lowest level since January 2011. Typically, low interest rates make credit cheaper for importers and easier for commercial banks to hold long dollar positions, putting the shilling under pressure. "The move above 84.50 was bound to see some short covering from banks," added Dickson Magecha, a trader at Standard Chartered Bank.

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