Home ECONOMY Foreign Currency Reserves Fall to 5-Week Low

Foreign Currency Reserves Fall to 5-Week Low

by biasharadigest

Kenya’s foreign currency reserves continued to shrink for the fourth straight week according to data released by the Central Bank of Kenya (CBK). The reserves fell to $7.48 billion on 27th May 2021, a five week-low, and 1% lower than the $7.546 billion on 20th May 2021.

Despite the dip, the reserves meet CBK’s requirement of at least 4 months of import cover and the East African Community requirement of at least 4.5 months of import cover.

The shilling remained stable against the US dollar and other major currencies, exchanging at KSh 107.57 per US dollar on May 27, compared to KSh 107.92 per US dollar on May 20.

Excess reserves held by commercial banks decreased to KSh15.5 billion last week from KSh19.1 billion the previous week. The average interbank rate, which is the rate of interest charged on short-term loans between banks, declined to 5.03% at the end of last week from 5.09% the previous week.

According to the Central Bank, gross domestic debt climbed to KSh 3.65 trillion on 21 May, from KSh3.488 trillion on 31st December 2020.

Also read: Kenya’s Forex Reserves Climb to Highest Level Since February

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