The shilling waffled to the weaker side at the start of the week as demand for the greenback dominated the trading session.
Foreign currency inflows that gave the home unit a boost last week seemed to have fizzled out leaving the home unit weighed down by reviving dollar appetite from importers.
Looking ahead, we expect the local currency to remain trapped within the current range, with the direction of the USDUGX pair remaining mostly flow driven in the near term.
The dollar traded higher in the previous session, gaining as investors’ appetite for risk weakened, following reports that Chinese officials were reluctant to agree to the trade deal presented by the U.S. Attention moves to U.S Producer Price Index data to be released today and any progress on the U.S China trade talks.
The EUR/USD pair traded towards 1.1000 levels yesterday, but gains were capped after the release of secondary data.
Leading indicators suggest Germany factory orders dropped in August, printing a 0.6% drop month-on-month and 6.7% descent year-on-year.
Focus shifts to German industrial production data due today. The GBP/USD pair lacked any firm directional bias on Monday and was seen fluctuating in a narrow trading band, as Renewed Brexit-pessimism continued weighing on the Pound.