‘Dollar exchange rates to remain unpredictable’ – KBA
The Kenya Bankers Association (KBA) now says the exchange rate for the US dollar against the Kenyan shilling will remain unpredictable.
This comes at a time the exchange rates are fluctuating, even as the shilling rallies against the dollar.
In a statement, KBA chair and NCBA Group Managing Director John Gachora said the exchange rate is expected to move in either direction to reflect the forces of supply and demand at any given time.
On Thursday, February 15, 2024, the dollar buying and selling rates printed at an average price of Ksh145 per dollar and Ksh148 per dollar, respectively.
Gachora attributed the changes to the Infrastructure Bond issued by the government, which received total bids worth Ksh288 billion. The Central Bank of Kenya accepted Ksh240.9 billion with Ksh218 billion in competitive bids.
"Today’s move is rightly attributable to growing confidence in Kenya’s macroeconomic performance and outlook, including the recent floatation and successful pricing of a US $1.5 Eurobond and the successful issuance and sale of an 8.5-year Infrastructure Bond," he added.
Gachora revealed that banks hold 50 per cent of the bond issued by CBK.
"It is instructive to note that as significant players in the domestic market, the majority of our members participated quite strongly in the Ksh70 billion Infrastructure Bond, and banks hold just about 50 per cent of outstanding public debt stock. Expectedly, the infrastructure bond elicited considerable foreign investor appetite, leading to the shilling rally, especially on the back of the sovereign’s successful Eurobond issuance that beat back quite convincingly earlier difficult risk concerns."
Gachora commended the government CBK for "their economic stewardship through a tumultuous time in the country’s economic history".
"At KBA, we will continue to engage with the Government, the Central Bank of Kenya, and all economic agents as we seek to foster an even more conducive business environment necessary to foster greater prosperity for our people," he added.
On Friday, the dollar was trading at an average of Ksh143.
