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Kenya’s currency hit an all-time low of 150 shillings to the dollar yesterday (Monday). The East African country is heavily indebted facing high inflation and other economic distortions. The Kenyan currency has lost almost 24% of its value against the dollar, over the last year
Kenya’s currency hit an all-time low of 150 shillings to the dollar yesterday (Monday). The East African country is heavily indebted facing high inflation and other economic distortions. The Kenyan currency has lost almost 24% of its value against the dollar, over the last year.
A dollar was selling at 150 shillings yesterday (Monday). Value quoted by some commercial banks and bureaux de change had breached that figure, according to the Central Bank of Kenya. Analysts say this new low is mainly due to the strengthening of the US currency. The Middle East crisis is pushing investors towards safe havens and the high yields on US Treasury bonds and gold. Gold prices also hit a record high.
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This depreciation is making imports more expensive and increasing Kenya’s debt. Kenya’s debt stood at more than 10,100 billion shillings (64.4 billion euros) at the end of June. This works out to around two-thirds of gross domestic product (GDP). The main debtor country is China. The debt repayment cycle will start from next July, further straining the economy. Significantly, Kenya has sought US$ 1 billion from China and rescheduled its debt payment. Kenyan strongman Ruto was recently in Beijing to attend the BRI Forum meeting. It is not known whether China has agreed to both propositions of the indebted Kenya.
