Nipate
Forum => Kenya Discussion => Topic started by: sema on January 20, 2023, 02:29:51 PM
-
Shilling is getting pummeled. What is going on here?
-
It certainly weakened - after xmas festivals when economy shutdown - there is demand for dollars now as importers get back to business.
CBK since 2020 - IMF taking over - no longer intervenes - so well shall see.
https://www.centralbank.go.ke/forex/
-
Ksh has lost ground als to the Euro. Now trading at Ksh. 134.
-
https://www.the-star.co.ke/business/kenya/2023-01-19-gloomy-outlook-for-kenya-as-interest-rates-projected-to-rise/
Kenyans are staring at tough economic times and expensive household budgets after the shilling hit a historic low against the dollar to trade at Sh124.00.
This has set stage for higher commodity prices for the imported goods and experts reckon that the trend is set to continue for longer in 2023.
Sanlam Investments East Africa 2023 investment themes and outlook, show that the shilling will continue to remain under pressure in 2023, as developed economies counter inflation by tightening monetary policies.
From the report, currency pressure remains a key risk to interest rates outlook not only in Kenya but the region at large.
Sanlam chief investment officer Shritesh Nanji said global shocks have exposed Kenya's vulnerability due to higher debt to GDP ratio, and exposure to foreign currency debt.
“The rise in global interest rates has strengthened the dollar and resulted in capital outflows from emerging and frontier markets back into hard currency assets. This has limited the capacity of developing countries to access international debt markets causing significant challenges and vulnerabilities,” said Nanji.
The exposure is coming at a time that Kenya is facing a Eurobond repayment of $2 billion (Sh248 billion) in June 2024.
Sanlam projects that the increased pressure on the currency could further exacerbate the pressure on interest rates.
Kenya faces significant currency pressures on account of external debt repayment obligations expected in 2024.
“We expect the CBK to prioritise foreign debt service repayments. The government will increasingly rely on multilateral agency funding, commercial syndicated loans, and the CBK forex reserves to fund foreign debt maturities,” a report by Sanlam released yesterday, reads in part.
Sanlam deputy chief investment officer Dan Gathogo said interest rates in Kenya will likely remain elevated in 2023, given the funding requirements of the government and the requirement for the Central Bank of Kenya to manage inflation.
Historically, low interest rates in advanced economies have been positive for developing economies.
The recent rise in global interest rates and US Dollar strength has resulted in capital outflows from Emerging and Frontier markets, as US Dollar assets have become more attractive.
This has also limited the capacity of developing countries like Kenya to access international debt markets, causing significant challenges and vulnerabilities to these economies.
Gathogo said after a 23.4 per cent market decline in 2022, stock market valuations are now cheaper and could represent an attractive entry point for long term investors.
"However, US Dollar strength and elevated yields in local government bonds could still dampen investors participation at the securities exchange,” he said.
The continued depreciation of the local currency, which has taken the shilling’s year-to-date losses against the dollar, is expected to push up living costs and hurt households that are already grappling with high fuel and food prices.
The outlook points at strict credit control measures this year, where CBK could increase rates in 2023 to manage the inflationary pressures and global risks.
Sanlam expects the global economy to slow down in 2023 and there remains a risk that some of the world’s major economies could enter a recession later in the year.
-
the claim by Njenga is that the depreciation is being manipulated. the real value is 200 shs but some sort of imf arrangement is in place to depreciate it ny 2 shs every two weeks
-
They should let it fall to its true value 200sh.
the claim by Njenga is that the depreciation is being manipulated. the real value is 200 shs but some sort of imf arrangement is in place to depreciate it ny 2 shs every two weeks
-
They should let it fall to its true value 200sh.
the claim by Njenga is that the depreciation is being manipulated. the real value is 200 shs but some sort of imf arrangement is in place to depreciate it ny 2 shs every two weeks
the slow,depreciation is part of fiscal policy I heard. need to read up on it
-
the slow,depreciation is part of fiscal policy I heard
And the goal of this fiscal policy is what?
-
the slow,depreciation is part of fiscal policy I heard
And the goal of this fiscal policy is what?
increase revenues..exports earn more, manage debt ratio and deficit. some economics voodoo that is too slippery to make sense of it. you know economics is a pseudoscience
will eventually discourage make imports unaffordable thus saving fx
-
It is not anything that Kenya is doing, or not doing, rather cheap money is disappearing and reality is setting in. Interest rates matter. Emerging economies will be hit hardest. In the develped world middle class will be hit with high rates while Musks' et al celebrate.
-
I hear from people in Ghana that the cedi is depreciating much faster than the shilling
-
I hear from people in Ghana that the cedi is depreciating much faster than the shilling
Ghana defaulted on her debt. Cedi going down completely. Ghana political elite have been stealing from the treasury like no one's business.
nana is another Uhuru or Tshikiendi a dynasty kid that thinks talking Nyeeeeweeee English makes them smart. Jamaa is the most overrated politician in West Africa
I knew he had lost his mind when he went around begging people for money to build a Cathedral in Ghana. he gives very good speeches but beyond that yeye ni bure
RIP Jerry Rawlings. Rawlings was hated by these people because he had no time for their nonsense. He was giving them hell even after he had retired. Ghana needs another Rawlings to cleanse that country of leeches
Ghana is is another Nigeria but with polite thieves
-
Nana appointed his villagemates to high postions in government. Bure kabisa. The man squadered a good chance to make Ghana great again. Now the former president John Mahama another thief is on his way back to power. Ghanians says Mahama was the smaller thief.
Ghana defaulted on her debt. Cedi going down completely. Ghana political elite have been stealing from the treasury like no one's business.
nana is another Uhuru or Tshikiendi a dynasty kid that thinks talking Nyeeeeweeee English makes them smart. Jamaa is the most overrated politician in West Africa
I knew he had lost his mind when he went around begging people for money to build a Cathedral in Ghana. he gives very good speeches but beyond that yeye ni bure
RIP Jerry Rawlings. Rawlings was hated by these people because he had no time for their nonsense. He was giving them hell even after he had retired. Ghana needs another Rawlings to cleanse that country of leeches
Ghana is is another Nigeria but with polite thieves