Relief for Kenyan importers as CBK cites four-month foreign exchange reserves

Kenyan businessmen can breathe a sigh of relief as the Central Bank of Kenya has declared that the country has sufficient foreign exchange reserves.

In a weekly bulletin issued by the Treasury, the country’s foreign exchange reserves will last for the next four months.

Further details reveal that the BCK holds 940.58 billion shillings (US$7,180), enough to cover imports during the indicated period.

In addition, CBK stated that the reserves met the legal requirements that require a 4-month coverage for imports.

Wads of 100 dollar bills

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Dennis Hallinan/Alamy

“Usable foreign exchange reserves remained adequate at $7.18 billion (3.8 months of import coverage) as of May 9. This meets the BCK’s legal requirement to strive to maintain at least 4 months of import coverage.” , stated the CBK.

Furthermore, in the bulletin, CBK explained that the Kenyan shilling had remained stable during the week trading at Ksh 131.25 on May 9.

The exchange rate was a gain from the Ksh 133.20 the shilling was trading at earlier in the week.

In addition, Kenya’s reserves were expected to increase thanks to a Sh158 billion advance from the World Bank disbursed on April 30.

The money approved on Tuesday, March 26 under Kenya’s First Resilient Growth and Fiscal Sustainability framework has reportedly skyrocketed crucial dollar reserves.

“Promote the efficiency, equity and transparency of public finances; foster more competitive and inclusive product and labor markets; and strengthen climate action,” the World Bank explained the proposed development objective of the loan.

In the final months of 2023, importers were reported to have experienced tough times in their businesses after stockpiles dwindled.

Furthermore, it was stated that the economy would lose the ability of companies to grow as most of them faced supply chain problems.

Image of a cargo clearance officer supervising customs clearance at the port of Mombasa.

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KPA