The Kenyan currency reached an unprecedented low of 150 shillings per US dollar, exacerbating the economic challenges in the heavily indebted East African nation marred by inflation, according to data from the Central Bank.
The Kenyan shilling’s depreciation has been rapidly accelerating, losing nearly 24% of its value against the dollar over the past year.
This decline has been attributed to the strengthening of the US currency, driven by recent Middle East crises that have spurred investment in safe-haven assets and the attractive yields on US Treasury bonds.
Consequently, rising import costs and mounting national debt, which stood at over 10,100 billion shillings at the end of June, are posing significant economic challenges for Kenya.
Repaying this debt, including obligations to China, is becoming increasingly burdensome for the government, as it will soon have to begin debt servicing in July.