Forex exchange reserves dipped by over Kes. 11.3 billion after the Central Bank of Kenya (CBK) released more dollars into the market to cushion the Kenyan shilling.
The banking regulator has however not given reasons for the huge drop but says reserves remain adequate and are within the statutory import cover of at least four months.
According to the latest central bank weekly bulletin, the foreign exchange reserves fell to Kes. 977.1 billion from Kes. 988.4 billion the previous week.
This was a Kes.11.3 billion drop as the Central Bank of Kenya (CBK) released more dollars into the market to cushion the Kenyan shilling.
The bank regulator did not give reasons for the huge drop but says the usable foreign exchange reserves remain adequate at USD 8,883 million which is 5.43 months of import cover and meets the CBK’s statutory requirement to endeavour to maintain at least 4 months of import cover, and the EAC region’s convergence criteria of 4.5 months of import cover.
The releasing of dollars into the market, however, did not bring down the depreciating wave as the Kenyan shilling on Monday traded at Kes. 109.9 against the dollar.
CBK Stability Statement on the Shilling.
Last week, the local currency was exchanged at Kes. 110.09 units against the greenback hitting a seven-month low due to depressed inflows from tourism and tea amid a recovering economy.
The Central Bank of Kenya however says the Kenya shilling has remained stable against major international and regional currencies during the week ending September 2.