The Central Bank of Kenya (CBK) has revealed that global oil prices have increased in the week that ended on September 19, 2024.
In its weekly bulletin, CBK said the international prices rose due to cuts on interest rates by the United States (U.S).
CBK said the prices increased from Ksh9,379.69 on the first day of the week to Ksh9,757.83 on the last day.
“International oil prices rose during the week ending September 19, mainly driven by U.S. interest rate cuts which helped ease concerns regarding weak demand from China. The price of Murban oil increased to USD 75.35 on September 19, up from USD 72.43 on September 12,” CBK said.
Global Oil Prices Reduced the Previous Week
This comes after the international oil prices declined marginally during the week ending September 12, reflecting a slowdown in global oil demand.
Murban oil price declined to USD 72.34 (Ksh 9,295.69) per barrel on September 12 from USD 72.99 (Ksh 9,379.22) per barrel on September 5.
EPRA Review
In its mo0nthly report on September 14, the Energy and Petroleum Regulatory Authority (EPRA) said fuel prices for the last review will be maintained for the period between September 15 and October 14.
Super Petrol and Diesel remain unchanged, retailing at Ksh188.84 and Ksh171.60, respectively while the maximum allowed price for Kerosene decreased by Ksh3.34.
EPRA stated that the prices include the 16% VAT, as outlined in the Finance Act 2023, the Tax Laws (Amendment) Act 2020, and the inflation-adjusted excise duty rates under Legal Notice No. 194 of 2020.
At the same time, the CBK said the Kenya Shilling remained stable against major international and regional currencies during the week ending September 19.
Also Read: Global Oil Prices Drop Ahead of EPRA’s Fuel Prices Review
Foreign Exchange Rates & Reserves
According to the bulletin, the Kenyan Shilling exchanged at Ksh129.20 to the US dollar on September 19, compared to Ksh129.18 per US dollar on September 12 (Table 1).
CBK also reported that the usable foreign exchange reserves remained adequate at USD 7,856 million (4.1 months of import cover) as of September 19 and hence it meets the CBK’s statutory requirement to endeavor to maintain at least 4 months of import cover.
Remittances
On remittance, the Central Bank reported that inflows in August 2024 totaled USD 427.2 million compared to USD 354.3 million in August 2023. This is an increase of 20.6 percent.
The cumulative inflows for the 12 months to August 2024 remained steady at USD 4,645 million compared to USD 4,120 million in a similar period in 2023
CBK explained that the remittance inflows continue to support the current account and the foreign exchange market.
“The US remains the largest source of remittances to Kenya, accounting for 56.0 percent in August 2024,” CBK said.
Also Read: Kenyans Hit Hard as Prices of Gas, Electricity and Rent & Other Commodities Hike- Report
Money Market
Liquidity in the money market remained adequate during the week ending September 19, supported by open market operations.
Commercial banks’ excess reserves stood at Ksh11.9 billion in relation to the 4.25 percent cash reserves requirement (CRR).
The average interbank rate was 12.70 percent on September 19 compared to 12.66 percent on September 12.
During the week, the average number of interbank deals decreased to 45 from 52 in the previous week, while the average value traded decreased to Ksh26.7 billion from Ksh34.2 billion in the previous week.
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