The Kenyan shilling lost 0.2 percent of its value versus the US dollar, ending the week at Ksh 122.8 compared to Ksh 122.5 the week before.
The shilling has lost value versus the dollar by 8.5 percent so far this year, more than double the 3.6 percent loss seen in 2021.
Increased dollar demand from importers, particularly those in the oil and energy sectors, against a slower supply of hard currency, contributed to the devaluation in part.
Within the 12 months that ended in October 2022, the current account deficit was anticipated to be 5.5 percent of GDP, the same as it had been in the corresponding period in 2021.
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Given that 69.7% of Kenya’s external debt was denominated in US dollars as of September 2022, the requirement to service government debt continues to place pressure on foreign exchange reserves.
The shilling is however anticipated to be supported by improved diaspora remittances, which as of November 2022 were USD 4.0 billion, an increase of 9.7% year over year from USD 3.7 billion reported over the same period in 2021.
Also read:Kenyan Shilling scores poorly against the US dollar
