Kenyan Shilling Depreciated By 0.1% Against The US Dollar in the Week

By Soko Directory Team / Published December 10, 2018 | 6:28 am

The Kenyan Shilling Dollar Turnover Kenyan Shilling

During the week, the Kenya Shilling depreciated by 0.1 percent against the US Dollar to close at 102.6 shillings to the dollar from 102.5 shillings recorded the previous week.

The slight depreciation of the local currency has been attributed to demand from oil and merchant importers buying dollars ahead of the holiday season exceeding dollar inflows.

The Kenya Shilling has, however, appreciated by 0.6 percent year to date, and in some market analysts’ view, the shilling should remain relatively stable to the dollar in the short term.

The shilling has been shielded with the narrowing of the current account deficit to 5.3 percent in the 12-months to September 2018, from 6.5 percent in September 2017, attributed to improved agriculture exports, increased diaspora remittances, strong receipts from tourism, and lower food and SGR-related equipment relative to 2017.

There has been an improving diaspora remittance, which increased by 6.9 percent m/m growth in diaspora remittances in the month of October 2018 to USD 219.2 mn from USD 205.1 mn recorded in September.

The y/y growth came in at 18.2 percent from USD 185.5 million recorded in October 2017. Cumulatively, total diaspora remittances rose by 39.5 percent in the 12 months to October 2018 to USD 2.6 billion from USD 1.9 billion recorded in a similar period in 2017.

The Central Bank of Kenya’s activities in the money market, such as repurchase agreements and selling of dollars, as well as high levels of forex reserves, currently at USD 8.0 billion, equivalent to 5.3-months of import cover, compared to the one-year average of 5.1 months has really helped the shilling.

About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

View other posts by Soko Directory Team