Kenyan Shilling Remains Stable Amid Low Dollar Demand
The Kenyan shilling maintained its stability against the US dollar on Thursday, trading at 129.25/129.45. This consistency is largely attributed to low demand from importers, easing pressure on the currency. The stability of the shilling provides some relief amid concerns over inflation and economic uncertainty in the country.
Market analysts note that while the shilling has experienced volatility in recent months, reduced demand for foreign currency has contributed to its steadiness. The Central Bank of Kenya (CBK) continues to monitor exchange rate movements to ensure stability in the financial markets.
Despite the temporary stability, economic experts warn that external factors such as rising global interest rates, fluctuations in fuel prices, and Kenya’s debt burden could impact the shilling’s long-term trajectory. 
Kenya Seeks New IMF Program to Address Debt Challenges
In a significant economic development, Kenya has reached an agreement with the International Monetary Fund (IMF) to end its current $3.6 billion lending program and pursue a new one. This decision comes as the country grapples with mounting debt-servicing costs due to heavy government borrowing in recent years.
The existing Extended Fund Facility (EFF) and Extended Credit Facility (ECF) programs, initiated to support economic reforms and fiscal consolidation, were originally set to expire next month. However, instead of proceeding with the final review and disbursement of approximately $480 million, Kenya and the IMF have opted to restructure financial support through a new program better suited to the country’s economic realities.
Why the Shift?
Kenya’s external debt has continued to rise, increasing pressure on government revenue and limiting fiscal space for development projects. The decision to renegotiate financial assistance underscores concerns over the sustainability of debt repayment, particularly as public debt has exceeded 70% of GDP.
The new IMF program is expected to focus on:
✔ Debt restructuring to ease repayment pressures.
✔ Stronger fiscal discipline to manage government spending and reduce budget deficits.
✔ Structural economic reforms to promote economic resilience and attract foreign investment.
Economic Outlook
With the shilling maintaining stability and the government seeking IMF support, Kenya faces a critical period of economic adjustments. The success of the new program will depend on efficient policy implementation, improved revenue collection, and sustainable debt management strategies.
As the country navigates these economic shifts, businesses and investors will be closely watching how Kenya balances financial stability and economic growth in the coming months.
