Kenya Central Bank Says Reserves Can Manage Volatility
Governor Kamau Thugge confirmed that Kenya holds 13 billion dollars in reserves to stabilize the shilling. The bank held rates steady to monitor energy prices.
The Central Bank of Kenya has confirmed its readiness to manage currency volatility through substantial foreign exchange reserves. Governor Kamau Thugge reported that the bank holds over $13 billion, a strategic buffer designed to withstand external shocks such as the ongoing tensions in the Middle East.
Geopolitical friction involving Iran, the United States, and Israel recently placed the Kenyan shilling under pressure, resulting in a 0.7% decline against the dollar in March. Despite this, the currency regained strength following news of a temporary ceasefire.
\"We have strengthened our buffers. We were waiting for this kind of shock. That is why we built up our reserves to the level where they are now.\"
Thugge made these remarks during a news conference, which took place the day after the central bank decided to keep its key lending rate unchanged. The bank has opted to pause its rate-cutting cycle to evaluate the impact of global energy price surges. While regional concerns dominate the local agenda, international markets and pairs such as the USD/JPY continue to reflect the broader economic sensitivity to global conflict. The governor noted that the reserves are positioned to offset potential slowdowns in tourism, remittances, and exports.
