Kenya’s Foreign-Exchange Reserves Reach Three-Year High

BREAKING NEWSNovember 14, 2024 at 3:18 PM UTC

TLDR

Kenya’s foreign-exchange reserves reach a three-year peak at $9.32 billion on Nov. 7, exceeding the central bank’s minimum target of four months of import coverage
Growth, in its 10th week, buoyed by a $600 million IMF disbursement, stabilizes the Kenyan shilling at 129 per dollar for seven consecutive sessions
Kenyan currency remains steady amidst global fears of trade protectionism and inflationary pressure under Donald Trump’s re-election

Kenya’s foreign-exchange reserves have climbed to a three-year peak, reaching $9.32 billion on November 7, according to the central bank.

This marks an 8.6% increase over the previous week and provides 4.8 months of import coverage, exceeding the central bank’s minimum target of four months to buffer against economic shocks. The growth, now in its 10th week, was buoyed by a $600 million IMF disbursement.

Kenya’s currency, the shilling, held steady at 129 per dollar for seven consecutive sessions through Nov. 13, contrasting with declines in other emerging markets facing fears of U.S. trade protectionism and inflationary pressure under Donald Trump’s re-election.

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Key Takeaways

Kenya’s stable currency and rising foreign-exchange reserves reflect a strong inflow of capital and effective central bank management. Foreign-exchange reserves have surged 40% year-to-date, supported by steady remittance flows, Kenya’s top foreign-currency source, and rising export revenues. Increased demand from foreign investors for local currency securities also contributed to the reserve buildup. In June, Kenya successfully refinanced a $2 billion eurobond, enhancing fiscal stability as it navigates global economic uncertainties.

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