Shilling Still Resilient Against The US Dollar Despite The Challenges

The Kenyan shilling has continued being resilient against the US Dollar despite predictions by market analysts that it would only hold for a short term.

At the beginning of 2018, most economic analysts predicted doom for the local currency foreseeing it getting hit by foreign currencies as the year progressed on. The shilling, has, however, continued to prove them wrong.

According to recent stats, the shilling is set to hold strong against the US Dollar in the short term. This is attributed to the increased hard currency from the diaspora as well as foreign and direct investments from abroad.

Wednesday saw the local currency slightly spiking against the US Dollar to close the day at 100.70 shillings to the dollar. Commercial banks across the country bought the dollar at 100.70 shillings and sold it at 100.90 shillings.

Towards the end of last week, the International Monetary Fund (IMF) announced that it would not renew Kenya’s access to the 99.81 billion shillings meant for the insurance of the shilling. Most analysts said that the shilling would suffer as a result.

The Finance Bill 2018

Members of Parliament are set to debate and vote the Finance Bill 2018 as per the recommendations from President Uhuru Kenyatta.

The debate and voting come a day after a court declared the bill illegal in a case that had been filed by activist Okiya Omtatah. According to the ruling delivered by Justice Wilfrida Okwany, the Cabinet Secretary for Treasury, Henry Rotich, did not follow procedure when he presented the Finance Bill 2018.

Among the proposals by the president is to have the earlier 16 percent VAT on fuel reduced half to 8 percent but introduce other taxes and deductions such as a mandatory 1.5 percent on salaried employees for the purposes of funding the Big 4 Housing Agenda. The government also plans to tax mobile data and calls by 15 percent.