Kenya’s foreign exchange reserves reached a new pinnacle of 7.896 billion U.S. dollars on Friday, following an increase of 121 million dollars, according to the Central Bank of Kenya’s (CBK) weekly financial markets update.
This significant rise occurs shortly after the nation fully settled its 2 billion dollar Eurobond debt, initially procured in 2014, utilising a loan from the World Bank. The latest figures show an increase from the previous week’s reserves of 7.775 billion dollars.
The East African nation settled the remaining 72 billion shillings (approximately 558.16 million dollars) of the Eurobond debt ahead of the 24 June deadline. Earlier in February, Kenya had successfully raised 1.5 billion dollars through a Eurobond buyback offer, aimed at mitigating the risk of default.
“The usable foreign exchange reserves remained adequate at 7.896 billion dollars, an equivalent of 4.1 months of import cover. This meets the statutory requirement to endeavour to maintain at least 4 months of import cover,” stated the CBK.
The rise in foreign exchange reserves fortifies the CBK’s ability to support the Kenyan shilling should it encounter pressure from international currencies. Despite global economic uncertainties, the Kenyan shilling has maintained stability against both regional and global currencies, with an average exchange rate of 128.68 to the dollar this week.
The augmentation in reserves not only underscores the country’s robust financial management but also assures markets of Kenya’s capacity to meet its international obligations and stabilise its currency if necessary.
