Kenyan shilling has been appreciating against the dollar in the 11 days. On Wednesday, it posted it’s strongest ever gain in a day in 12 years after the government received inflows “to pay off the $2 billion Eurobond.”
The gain has pushed the local currency to its strongest level since November last year while cutting off all the losses this year. Some banks in the country have recorded the sale of Kenyan shilling against the dollar below 153.75.
For instance, Equity bank sold the dollar for sh153.75 on Wednesday, while KCB sold it for sh157.5. Forex bureaus were selling the dollar at between Sh152 and Sh157.
On Tuesday the Central Bank of Kenya quoted the local currency at Sh156.7 against the American dollar.
Speaking on Wednesday in Murang’a county President William Ruto assured Kenyans that the shilling will further strengthen in the coming days.
“Nataka kuwahakikishia ya kwamba hata ile dollar mahali mlikuwa mmeona ilikuwa imefika sasa mtaona mambo ambayo hamjawahi kuona,” he added.
On January 15, the shilling had crossed the 160-unit points against the dollar, the lowest level on record.
The president further said that he would not allow the country to fall into debts. He added that the country will face the debt issue head on, and it will not default.
The record appreciation of the Kenya shilling is set to lower import costs as importers are required to part with less shilling for the same volume of goods ordered as this has helped the drop in prices of commodities such as fuel.
A stronger shilling will lower debt service costs with the Nation Treasury equating the movement of the currency by a single unit to impact debt service costs by Sh40 billion this will impact positively to the government. With the shilling gaining by Sh3.62 against the American dollar, Kenyans debt service costs have been reduced by Sh144.8 billion.
With the shilling gaining by Sh3.62 against the US dollar in the week to Tuesday, Kenya’s debt service costs have been trimmed by Sh144.8 billion in just seven days.https://t.co/spKY70Vmo2
— NTV Kenya (@ntvkenya) February 15, 2024