adminAccording to the World Bank’s latest report, the Kenyan shilling is currently ranked as the best-performing currency in Sub-Saharan Africa. The report revealed that the incremental value of the shilling was directly linked to the hike in the base lending rate by the Central Bank of Kenya (CBK).
The World Bank report also projected that Kenya’s economy would grow by 5 percent in 2024. According to Tuko.co.ke, The report explained that in the medium term, growth will be supported by increased investment predicated on restored access to international capital markets, which will spur investor confidence and capital inflows.
“The Kenyan shilling is the best-performing currency in the subcontinent, as it recorded an appreciation of 16 percent so far this year. After strengthening by 14 percent by mid-February, the Zambian kwacha has lost some ground and recorded a year-to-date appreciation of 2,4 percent as of mid-March.
In both cases, the monetary authority hiked interest rates to defend their currencies. In Kenya, securing funds to repay its Eurobond falling due in June 2024 restored confidence and increased the demand for local currency,” the World Bank stated.
Last month, the Central Bank of Kenya (CBK) announced during the Monetary Policy Committee (MPC) meeting that it would maintain its base lending rate at 13 percent. According to the statement released by the CBK, the monetary policy committee cited the appreciating value of the Kenyan shilling, among other factors.
Since the Monetary Policy Committee (MPC) meeting in April, Kenya’s stock market has improved from the worst to the best. According to experts, more investors currently prefer Kenyan shilling-denominated investments because the high base lending rate means more interest. – Business Insider Africa
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