Kenyan shilling depreciates again against the US dollar in forex markets despite CBK rates

• The Kenyan shilling experienced a decline in its value in the forex markets during the last two days of the week between April 14 and April 20.
• Despite the Central Bank of Kenya (CBK) indicative interest rates remaining unchanged at KSh131.43, the foreign exchange markets saw increased demand for dollars, with buying prices ranging between KSh133 and KSh135 and selling prices ranging from KSh135 to KSh139.
• CBK maintained that the Kenyan shilling remained stable against major international and regional currencies in the week ending April 18, with an exchange rate of KSh131.37 per US dollar.

Elijah Ntongai, a journalist at TUKO.co.ke, has over three years of financial, business and technology research expertise, offering insights into Kenyan and global trends.

The Kenyan shilling has recorded another depreciation in the forex markets in the last two days of the week between April 14 and April 20.

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The decline in foreign exchange markets is indicative of increased demand for dollars in the forestry market, which is not reflected in indicative CBK rates, which remained unchanged at KSh131.43.

In various forex markets, the buying price of the dollar ranged between KSh 133 and KSh 135, while the selling price ranged between KSh 135 and KSh 139.

However, the latest CBK Bulletin maintained that:

“The Kenyan shilling remained stable against major international and regional currencies during the week ending April 18. The rate stood at KSh131.37 per US dollar on April 18, compared to KSh130.39 per US dollar on April 11 .”

Dollar prices in the forex markets

This comes after a recent report from TUKO.co.ke that the Kenyan shilling suffered losses against the dollar in the first two days of the trading week starting April 15.

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On Monday morning, April 15, the Kenyan shilling traded at KSh 127.7 and closed the day at KSh 130.9.

In an earlier report, FXPesa lead market analyst Rufas Kamau expressed concern that as Kenya imports many goods, payments for these imports could take more dollars out of circulation, leading to higher demand.

“Imports will sooner or later bring the new dollars to the markets, and we will face the same dollar shortage problem again. With US inflation rising to 3.5% in March, the US Federal Reserve is likely to keep interest rates high for longer, which is expected to further strengthen the dollar. This is expected to help the dollar recover against the Kenyan shilling,” Kamau told Tuko.co.ke.

The recent rise in US dollar prices reflects an increased demand for green money in the foreign exchange markets.

Source: TUKO.co.ke