• Central Bank of Kenya (CBK) governor Kamau Thugge said the Kenya shilling became the best-performing currency against major currencies globally
• On Tuesday, October 16, the CBK quoted the shilling at 129.1987 against the greenback and 168.9208 against the sterling pound
• FX Pesa lead market analyst Rufas Kamau explained that the strengthening of the Kenya shilling was expected to weaken Kenyan exporters’ business

TUKO.co.ke journalist Japhet Ruto has over eight years of experience in financial, business, and technology reporting and offers profound insights into Kenyan and global economic trends.

Central Bank of Kenya (CBK) governor Kamau Thugge has revealed that Kenya shilling has appreciated by 18% against the United States (US) dollar.

What Kamau Thugge said about Kenya shilling

In a statement on Tuesday, October 16, Thugge said the shilling, in the process, became the best-performing currency against major currencies globally.

Read also

Kenyans react after EPRA reduces fuel prices in October review

“The Kenya shilling has appreciated by 18% against the US dollar becoming the best currency against major currencies globally,” Thugge said, as reported by KBC.

On Tuesday, October 16, the CBK quoted the shilling at 129.1987 against the greenback.

The regulator shared the shilling’s exchange rate against other local and international currencies.

What strong Kenya shilling means

FX Pesa lead market analyst Rufas Kamau explained that the strengthening of the Kenya shilling was expected to weaken Kenyan exporters’ business.

Kamau noted that imports from the region were expected to increase, but increased confidence for foreign direct investments.

“The strengthening of the shilling against the US dollar and other foreign currencies has a net benefit for the country. Being a net importer, we save more money with a strong shilling compared to the value we lose through lower exports,” Kamau told TUKO.co.ke.

Read also

CBK governor explains factors behind stable Kenya shilling and growing forex reserves

Kamau explained that the drop in the US Fed interest rate was significant to the strength of the shilling.

“The Fed surprised the market with a 50 basis point rate cut to 4.75%-5% on Wednesday, September 18. This is expected to weaken the USD and could drive the Kenya shilling higher towards 120,” said Kamau.

How much did Kenyans send from abroad?

CBK reported a strong foreign exchange reserve of USD 7,856 million, supporting four months of imports.

This followed strong remittance inflows to the country in August 2024, as Kenyans abroad sent home over KSh 55 billion worth of dollars as the shilling stabilised.

CBK noted that the remittance inflows support the current account and the foreign exchange market.

The US remained Kenya’s largest source of remittances, accounting for 56% in August 2024.

Source: TUKO.co.ke