The exchange rate of the Kenya Shilling against the US Dollar on Monday hit and crossed the 150-unit mark after months of depreciation that has seen the Kenyan currency take a beating.
The Kenya shilling has depreciated by 17.7 per cent against the US dollar since January 2023, which accounts for more than double the 8.3 per cent shed in the entire 12 months of 2022.
According to the Central Bank of Kenya (CBK) indicative rate published on Monday morning, the buying price of the US currency stood at Sh149.84 and selling price at Sh150.04 units.
The 12 commercial banks in Kenya were selling the US dollar at between Sh154.95 and Sh157 and buying the strong currency at between Sh141 and Sh149.95.
The removal of a CBK rule setting daily deviation from the indicative rate at 20 cents and the revival of the interbank dollar market in April aided the exchange rate to find its own level.
Before April, banks quoted their dollar buying rates in line with CBK’s to avoid warnings by the regulator, but on selling side they charged a margin of up to Sh13 above the official rate.
This comes amid concerns from financial experts that the weakening Kenya Shilling could slide further and breach the 160 unit mark in the coming months, which is causing a strain on Kenyan importers resulting in spiking of a wide variety of products including petroleum products.
He appeared before the National Assembly on September 27, 2023, Treasury CS Njuguna Ndung’u denied the shilling was on a free fall but adjusting from “historical policy mistakes.”