The Kenyan shilling gained strength against the US dollar on Wednesday due to increased demand for the local currency by companies. This improvement was driven by manufacturers exchanging US dollars for Kenyan shillings to meet their quarterly tax obligations, according to Reuters.
The heightened demand for the shilling helped alleviate pressure on the local currency, leading to its appreciation against the greenback. As of Wednesday, September 25, data from the London Stock Exchange Group (LSEG) indicated that the shilling was trading at 128.50 units to the dollar, showing a slight recovery from last week’s dip to Ksh129 per dollar.
Despite the marginal gain, the currency’s performance is still under scrutiny by market watchers, especially importers who were concerned by last week’s depreciation. The shilling’s strength was further bolstered by increased foreign currency inflows from diaspora remittances and investments, attributed to the US Federal Reserve’s recent interest rate cut.
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