CBK responds after Ksh hit the 140 mark against the dollar, details the amount of forex reserve
CBK details amount in dollar reserve after Ksh hit 140 mark amid reports by importers of forex shortage
CBK details amount in dollar reserve after Ksh hit 140 mark amid reports by importers of forex shortage.
On Friday, March 17, the Central Bank of Kenya (CBK) provided information on how long the foreign exchange reserve of Ksh854 billion (USD 6.5 billion) will endure.
The Kenyan shilling was holding steady versus the dollar even as the latter crossed the 140-mark, according to CBK’s weekly bulletin.
CBK noted that the reserves were adequate pursuant to the bank’s regulations.
It was further explained that the sufficiency of the reserve will enable importers to continue with their business without any hindrance.
“The usable foreign exchange reserves remained adequate at USD 6,560 million (3.66 months of import cover) as of March 16. This meets the CBK’s statutory requirement to endeavor to maintain at least 4 months of import cover,” read the statement in part.
According to CBK, it exchanged the dollar at Ksh129.76 to the banks.
Various banks, on the other hand, sold the dollar at Ksh140.
CBK also noted that the reserves would be strengthened in the coming weeks as Kenyans living abroad remit money back home.
“Remittance inflows continue to support the current account and the foreign exchange market. The US remains the largest source of remittances into Kenya, accounting for 59 percent,” CBK stated.
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The weakening of the Kenyan shilling has been occasioned by the high demand for importation – done in dollars amid the limited reserves.
Major imports to Kenya included fuel, cars, and other technological products.
Recently, there was concern over the shortage of the US dollar, which had been projected to affect the prices of a number of basic commodities, such as fuel.
Notably, during the review of fuel prices by the Energy and Petroleum Regulatory Authority (EPRA), the price of super petrol increased to Ksh2.
The increase was explained by the dominance of the dollar against the shilling.
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