NAIROBI (Reuters) - The Kenyan shilling was steady against the dollar on Tuesday as the market consolidated the previous session's gains before a central bank rate-setting meeting later in the day.
At 0721 GMT, commercial banks quoted the shilling at 85.45/65 per dollar, barely changed from Monday's close of 85.40/60.
The local currency gained 0.8 percent on Monday in the first trading session after the result of a broadly peaceful presidential election, won by Uhuru Kenyatta.
Raila Odinga, the runner-up in the vote, said he would challenge the outcome of the ballot in court.
Traders said the market was watching for the outcome of the court case, which could have a big impact on the shilling's direction.
"The shilling is not completely out of the woods with a petition contesting the results announced by the IEBC (Independent Electoral and Boundaries Commission) about to be tabled in the Supreme Court by the losing coalition," Bank of Africa said in a daily note.
The shilling is 0.7 percent firmer against the dollar so far this year.
The market is also awaiting the decision of the monetary policy committee (MPC) meeting later on Tuesday, which is widely expected to hold the main central bank lending rate at 9.50 percent as policymakers adopt a cautious approach after the election.
All 11 analysts and traders polled by Thomson Reuters said they expected the central bank to hold its benchmark rate.
"We expected them to hold this time round. The next decision in two months' time will be more important," said Julius Kiriinya, a trader at African Banking Corporation.