Kenyan shilling hits 17-month high at 128.96 against the dollar
Compared to the period last year when it traded at an all-time low of 160, the local currency has gained about 32 unit values, representing a 20 per cent gain.
The Kenyan Shilling has strengthened to a 17-month high against the US dollar, trading at 128.96 as markets opened on Tuesday.
The record marks a significant gain from its previous average of 129, where it had largely remained stable for over a year.
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Notably, the local currency clocked the stable exchange (129 average) one-year milestone in August this year.
It began to retreat from the 130 mark in late July 2024, following a period of consecutive strengthening since early February, when it hit the historic low of 160.
Now at an average of 128, the performance represents the currency’s strongest level in 17 months, a record that has not been seen since mid-2024.
The sustained stability since last year was attributed to the successful settlement of the inaugural $2 billion (Sh259.6 billion) Eurobond buyback plan, where the government paid back $1.5 billion (Sh194.7 billion) in February, boosting investor confidence.
According to the National Treasury, the stability is also underpinned by improved macroeconomic fundamentals, including improvements in foreign exchange inflows, driven by sustained diaspora remittances, strong export performance, and a rebound in tourism, which have in turn strengthened foreign exchange reserves.
Official data shows foreign exchange reserves have consistently remained above $10 billion since May 2025, providing an import cover ranging between 4.7 and 5.3 months, above the minimum statutory requirement of four months.
With import costs directly tied to the strength of the shilling, the sustained rate signals some respite for the economy, particularly in stabilising the prices of imported goods.
Compared to the period last year when it traded at an all-time low of 160, the local currency has gained about 32 unit values, representing a 20 per cent gain.
If the 128 average is maintained, importers will spend about Sh32 less than what they used to purchase a single dollar for imports when the shilling was at its lowest.
A strong shilling against the greenback is also expected to cut down debt burden pressure since most of it is dollar-denominated.
World Bank’s latest economic update for Kenya says the country’s external debt profile has improved in the short term, supported by the appreciation of the shilling and government efforts to reduce refinancing risks.
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