Kenyan shilling continues to depreciate against US dollar – Kenya Broadcasting Corporation
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The Kenyan shilling continues to depreciate against major global currencies trading at an all-time high of 117.57 shillings against the US dollar.
The Kenyan currency has been on a record-setting free fall in the last one as dollar appetite from the energy sector outstrips supplies from exports and remittances.
The Central Bank of Kenya (CBK) is further warning global inflationary pressures will most likely worsen the situation on the aggressive pace of monetary policy tightening measures by major central bankers.
The Kenyan shilling has been on the receiving end losing close to 4% of its value against the United States dollar since the start of the year, according to various financial analyses.
The situation has been exacerbated by a biting dollar shortage that has seen some manufacturers close their production lines.
Traders were quoting the Kenyan shilling at 113.61 shillings against the dollar in January to a record-breaking 117 shillings currently.
The central bank of Kenya is warning that the ongoing conflict between Russia and Ukraine, and the tension between Russia and the West is likely to compound the situation further for the Kenyan shilling.
The worsening Dollar position is also undermining the official foreign exchange reserves.
CBK says the reserves have declined, to 8 billion US dollars as of June 23rd 2022, compared to 8.18 billion US dollars on 26th May 2022, and 8.11 billion Us dollars on 16th June 2022.
The CBK however insists the reserve figures meet statutory requirements, maintaining at least 4 months of import cover, and the East African Community’s convergence criteria of 4.5 months of import cover.
In the week ending the 23rd of June 2022, share prices at the Nairobi Stock Exchange have also declined by 4.3 percent, while market capitalization declined by 4.6 percent.
However, total shares traded rose by 4.2 percent.
The CBK says open market operations remained active, where the average interbank rate was 5.27 percent on June 23 compared to 5.30 percent on June 16.
Watch what’s live now on KBC Channel 1 and our other TV Stations. Never miss new episodes from your favorite shows, reruns and movies. Stream online for free today.
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