NAIROBI, Dec. 28 (Xinhua) -- Kenya's foreign exchange reserves rose by 191 million U.S. dollars this week, reaching a seven-week high of 9.2 billion dollars, the central bank said in its weekly financial markets update released Friday evening.
The new reserves, equivalent to 4.6 months of import cover, increased from 9.01 billion dollars on Dec. 19, according to the apex bank. The rise was attributed to increased inflows from export earnings and remittances during the festive season.
This week's increase reverses a negative trend that began in November, when forex reserves declined to below nine billion dollars on Dec. 5.
Governor of the Central Bank Kamau Thugge said on Dec. 6 during a monetary policy briefing in Nairobi, the capital, that the institution expects reserves to rise by up to 2.23 billion dollars by the end of 2024.
Thugge said that the increase would result from higher remittances during the festive season, stronger export earnings and disbursements from the International Monetary Fund (IMF).
In November, the IMF disbursed 78.4 billion shillings (about 605 million dollars) to Kenya under a funding program scheduled to conclude in April 2025.
Meanwhile, diaspora remittances have been rising as inflation in source markets in Europe and America eases. Kenya's diaspora remittances reached a record 4.01 billion dollars in the first 10 months of 2024.
Similarly, exports have grown by 12 percent over the same period, driven by increased shipments of tea, vegetables and fruits, according to the central bank.
"The usable foreign exchange reserves remained adequate at 9.2 billion U.S. dollars, meeting the CBK's statutory requirement to maintain at least 4 months of import cover," the central bank said.
The increase in forex reserves ensures the bank has sufficient dollars to support the shilling, which strengthened ahead of the festive season to an average of 129.29 against the dollar from a low of 130. ■
