Kenya’s foreign exchange reserves fell to USD 13.656 billion, providing the country with 5.8 months of import cover according to the Central Bank of Kenya (CBK).
In a bulletin released on April 2, CBK said the reserves remain well above the statutory requirement of at least four months of import cover, indicating a strong external buffer for the economy.
“The foreign exchange reserves remained adequate at USD 13,655.70 million (5.8 months of import cover) as of April 1. This meets CBK’s statutory requirement to endeavor to maintain at least 4 months of import cover,” read part of the report.
As of the week ending March 26, foreign exchange reserves stood at USD 14.02 billion, providing six months of import cover.
CBK on Money Market
In the money market, liquidity remained high, with commercial banks holding an average of KSh6.2 billion above the 3.25 percent Cash Reserve Ratio.
The Kenya Shilling Overnight Interbank Average Rate (KESONIA) held steady at 8.74 percent, while interbank transactions and average value traded increased.
Currency Trends
Here is a breakdown of how the Kenya Shilling held steady against major currencies in the week ending April 2.
It exchanged at Ksh129.99 per U.S. dollar on April 2.
Against other major currencies, the shilling traded at:
- Sterling Pound – Ksh171.98
- Euro – Ksh149.94
- South African Rand – 7.64
- Japanese Yen (100 units) – Ksh81.55
Against regional currencies, the shilling exchanged at:
- Ugandan Shilling – Ksh28.79, Tanzanian Shilling – Ksh19.96, Rwandan Franc – Ksh11.23
Also Read: Kenya’s Foreign Exchange Reserves Jump to US$14.59 Billion
In the government securities market, the April 2 Treasury bill auction received bids totaling KSh17.0 billion against an advertised KSh24.0 billion, representing 70.9 percent of the advertised amount.
Interest rates fell for the 91-day and 364-day bills but rose slightly for the 182-day bill.
During the April 1 Treasury bond auction, reopened 15-year and 25-year bonds received KSh74.9 billion in bids against KSh40.0 billion advertised, representing 187.2 percent.
Also Read: Kenya’s Foreign Exchange Reserves Climb Slightly as Diaspora Remittances Increase
NSE Gains and Global Trends
Equity markets at the Nairobi Securities Exchange saw gains, with the NASI up 1.45 percent, NSE 25 up 2.52 percent, and NSE 20 up 0.96 percent.
Market capitalization rose 2.21 percent, total shares traded increased 0.15 percent, while equity turnover fell 15.92 percent.
Bond market activity increased, with domestic secondary market turnover up 11.87 percent.
In international markets, CBK stated that Kenya’s Eurobond yields rose by 48.69 basis points, mirroring increases in Côte d’Ivoire and Angola.
Global trends saw inflation concerns persist amid geopolitical risks and higher energy prices. Eurozone inflation rose to 2.5 percent in March from 1.9 percent in February.
The U.S. Dollar Index weakened by 0.25 percent, while international oil prices eased; Murban crude fell to USD 89.45 per barrel on April 1 from USD 97.99 on March 26, amid supply concerns over the Strait of Hormuz closure.
