The Central Bank of Kenya (CBK) has attributed the continued stability of the Kenyan shilling against the US dollar to diversified sources of foreign exchange inflows, projecting the trend will hold in the near term.
As of August 12, 2025, the shilling was trading at Sh129 to the dollar, a marked improvement from January 2024 when it hit a record low of Sh162. CBK Governor Kamau Thugge said the stronger performance has been anchored by remittances from Kenyans abroad, earnings from coffee and other exports, and inflows from offshore banks.
“The Kenyan shilling has remained stable, supported by diversified foreign exchange inflows from diaspora remittances, offshore banks, coffee, and other export items. We expect this stability to continue into the near term,” Dr. Thugge said during the Monetary Policy Committee (MPC) briefing.
Findings from the CBK’s July 2025 Market Perceptions Survey indicate strong optimism in the market. According to the report, 77% of bank respondents and 71% of non-bank respondents expect the shilling to remain stable or strengthen further, citing improved forex inflows, external financial support, low inflation, and overall macroeconomic stability.
However, CBK cautioned that some challenges could still exert pressure on the currency. These include higher import demand, rising external debt service payments, and volatility in global oil and commodity prices.
The shilling’s sharp depreciation in early 2024 was largely linked to Kenya’s $2 billion (Sh300 billion) Eurobond, which pushed up the cost of imports and swelled public debt. In a strategic move, the government issued a new $1.5 billion (Sh238 billion) Eurobond earlier this year to buy back the inaugural one maturing on June 24, easing repayment pressure and restoring investor confidence.
The CBK maintains that the combination of resilient export earnings, strong remittance flows, and prudent fiscal and monetary policies will be key in sustaining the shilling’s stability through the remainder of 2025.
For households and businesses, the stronger shilling has eased import costs and reduced inflationary pressures, offering a welcome reprieve after last year’s currency turmoil.
