The Kenya Shilling has continued to tumble against the US dollar, racing towards the 121 mark on Thursday, which could result in much higher cost of living.
The shilling exchanged at an average 120.93 to the dollar from 120.60 at the beginning of the month, as global factors among them the recent 0.75 percentage point Fed Rate hike continues to pill pressure on economies.
This is, however, the Central Bank of Kenya (CBK) indicative rate meaning importers could be accessing the dollar at a much high cost.
It comes on the back of shrinking forex reserves which fell to $7.3 billion (KES 883.3 billion) last week from $7.4 billion (KES 895.5 billion) a week earlier—the lowest level in seven years.
The situation is compounded by lower foreign funding, faster import growth and a slowdown in remittances, which experts say will continue affecting the shilling despite CBK’s interventions.
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