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Wednesday, April 17, 2024
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Kenyan Shilling Records Highest Gain Against US Dollar in 12 Years

Kenyan Shilling Records Highest Gain Against US Dollar in 12 Years
Kenyan Shilling Records Highest Gain Against US Dollar in 12 Years

The Kenyan currency continues to thread in a positive direction as it records another gain against the US dollar. The Kenyan Shilling which has been slowly recovering since the year began recently posted its highest gain in 12 years. This substantial gain boosted the currency to its strongest levels since November 2023.

A report by the Kenyan business newspaper, BusinessDaily, showed that the Kenyan Shilling experienced a significant resurgence owing to a wave of investor confidence that followed the government’s large inflows to settle the $2 billion Eurobond.

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The currency which is now trading below Sh153.75 at some commercial banks is the strongest it has been since November 2023, as it has managed to wipe out all the losses incurred this year.

According to the publication, the Kenyan Shilling has been on an upward trend for 11 straight days and counting.

“For instance, Equity Bank quoted the dollar on Wednesday at Sh153.75, while KCB had a quote of Sh157.5, the highest among eight banks,” tracked by the Business Daily.

“For their part, forex bureaus were selling the dollar between Sh152 and Sh157. On Tuesday, the CBK had quoted the local unit at Sh156.7 against the dollar,” BusinessDaily added.

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At the start of the month, Kenyan banks had quoted nothing surpassing Sh164.50/$1 dollars. Also, late last month, the Kenyan Shilling experienced a gain of 0.73 percent against the US dollar. The currency had not experienced this sort of gain in over 3 years, as the Shilling went from 161.36 to 160.19.

As expected the currency appreciation spells good news for businesses as import cost is set to reduce in its local currency terms.

On the flip side, the government will reduce the cost of debt service; the Treasury estimates that a unit change in the currency will have an impact on debt service costs of Sh40 billion.

Kenya finally met its commitment last week to buy back some of the Sh313 billion Eurobond notes expiring in June 2024 as part of a liability management operation aimed at reducing the country’s initial Eurobond repayment.

By CHINEDU OKAFOR

Source-https://www.pulselive.co.ke/

 

Kenyan Shilling Records Highest Gain Against US Dollar in 12 Years

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