Kenya’s foreign exchange reserves likely fell $8.2 billion from the peaks as the central bank intervened to reduce the slide of the currency.
Kenya’s reserves fell from its peak of $8.8 billion in mid-September to $ 8.2 billion during the week ended 22 October, the latest data released by the Central Bank said.
Consequently, the import cover has been declined from 5.36 months as at September 17, 2020, to 4.99 months on October 22, 2020.
“This meets the CBK’s statutory requirement to endeavour to maintain at least 4 months of import cover, and the EAC region’s convergence criteria of 4.5 months of import cover,” noted the CBK’s Weekly Bulletin Data.
Forex inflows from diaspora remittances have also declined from $274.1 Million in August 2020 to $261.7 Million in September 2020.
During the week, the Kenyan shilling depreciated marginally by 0.1 percent against the US dollar to Kshs 108.8 from Kshs 108.6 recorded week ending 16 Oct, mainly attributable to the dollar demand from the energy sector.