The Kenyan Shilling continued to hold steady against the dollar despite the nation being embroiled in political and economic turmoil.
Financial experts had earlier warned that the local currency would depreciate against the dollar following protests in the country which raised fears of capital flight.
Despite the widespread market pessimism, the Shilling continued to be bullish against the dollar due to agricultural exports.
“Kenya’s shilling was stable on Wednesday as foreign exchange inflows from tea exports matched dollar demand,” traders revealed as quoted by Reuters.
At the opening of the markets on Wednesday, July 17, commercial banks quoted the shilling at 129.50/130.50 per dollar.
Data from the Central Bank of Kenya (CBK) confirmed that the Shilling was maintaining its streak as the best-performing currency globally.
At the close of the market on Tuesday, July 16, the Kenyan Shilling was exchanging at 129.56 against the United States Dollar.
The local currency performed relatively well against other major world currencies including the Sterling Pound and the Euro.
According to CBK data, the Shilling exchanged at 167.87 and 141.01 against the Sterling Pound and the Euro respectively at the close of the market on Tuesday, July 16.
With the tea market in Kenya projected to grow by 8.77 per cent between 2024-2029, Kenya will continue to rely on the product to boost foreign exchange reserves and subsequently strengthen the local currency.
President William Ruto’s administration seeks to increase the tea market volume to USD3.44 billion over that period.
Other ways Kenya is seeking to strengthen its currency is through increased diaspora remittances as well as reducing overreliance on imports which gobble up the foreign exchange reserves.
