The Central Bank of Kenya (CBK) building in Nairobi. FILE PHOTO | NMG
Summary
- The usable reserves stood at $8.846 billion (Sh892 billion) compared to $8.791 billion (Sh887 billion) the previous week.
- The CBK did not explain last week’s increase in reserves, but early in the course of the period the shilling appreciated against a number of foreign currencies but later weakened against others.
The Central Bank of Kenya (CBK) increased its foreign exchange
reserves by an extra Sh5.5 billion ($55 million) last week, suggesting
more ability to fight future weakness in the local currency.
The usable reserves stood at $8.846 billion (Sh892 billion) compared to $8.791 billion (Sh887 billion) the previous week.
Two
weeks ago, the shilling got a boost when reserves sharply rose to
$8.831 billion (Sh891 billion) from $7.155 billion (Sh722 billion) after
the Treasury raised a Eurobond – which in turn improved the import
cover to six months from just below five months.
The
CBK did not explain last week’s increase in reserves, but early in the
course of the period the shilling appreciated against a number of
foreign currencies but later weakened against others.
The
initial appreciation trend was linked to the higher amount of reserves
as well as the confirmation of a Sh151 billion ($1.5 billion) facility
by the International Monetary Fund (IMF). The IMF said the cash would be
tentatively be available pending the review of the economic reforms by
September.
Last Thursday, Commercial Bank of Africa
said in its daily report that the shilling rally had stalled, but saw it
holding steady after that. It attributed this to end-of-the-month
return by importers to the market.
“The home unit was a
tad lower versus the greenback at the closing bell, trading within the
100.30–101.30 band as activity on the demand counter tipped the scale in
favour of shilling bearers,” the bank said last Thursday.
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