The Kenyan shilling lost ground against the dollar on Friday as traders reported that the demand for foreign currency from importers was not met by the inflows of foreign currency from the tea industry and the diaspora.
Commercial banks’ exchange rates for the shilling were 148.95/149.15 per U.S. dollar at 0945 GMT, up from 148.85/149.05.
“The tea sector and diaspora inflows came through yesterday but were not enough to cool the foreign currency demand from importers,” a dealer commented.
In the early morning hours of Friday, the shilling reached a fresh record low of 149.15/35. According to LSEG statistics, its value versus the U.S. dollar has decreased by more than 17% since the year’s beginning.
The Kenyan Shilling is strengthened by rising foreign exchange reserves due to increased remittances. International direct investment (FDI) in the Kenyan economy rises when the currency is strong and more appealing to international investors.
The value of the Kenyan Shilling has varied as of the most recent statistics in 2023. It’s crucial to remember that various factors, such as the state of the world economy, political stability, and market mood, impact currency markets.
The stability of the Kenyan Shilling is critically dependent on the performance of Kenya’s central bank. It can interfere in the foreign exchange market through careful monetary policy to reduce excessive volatility.
In conclusion, investors, policymakers, and everyone interested in Kenya’s economic environment must comprehend the performance of the Kenyan Shilling in the context of tea exports and diaspora F.X. inflows. A complex combination of regional and global influences still influences the value of the Kenyan Shilling. Knowing the currency’s prospects in the constantly shifting international financial market requires watching these trends.
