This archive report was first published on 25 May 2020.
Kenya's diaspora remittances fell by 9% in April, a decline attributed to the COVID-19 pandemic, according to the Central Bank of Kenya's weekly bulletin for the week ending May 21, 2020.
Remittances from the US and Canada, which account for 58% of April remittances, remained unchanged from March. However, remittances from the UK, Germany, South Africa, the EAC region, and the United Arab Emirates and Saudi Arabia declined.
The Central Bank of Kenya notes that the decline in remittances is largely due to the COVID-19 pandemic, which has affected global economic activity and travel.
Despite the decline in remittances, Kenya's usable foreign exchange reserves remain adequate at Ksh899.8 billion (USD8,489 million), equivalent to 5.11 months of import cover. The country's foreign exchange reserves received a boost earlier this month with the receipt of Ksh78 billion (USD739 million) from the International Monetary Fund (IMF) under the Rapid Credit Facility (RCF).
The money markets remained active in the week, with commercial banks' excess reserves standing at Ksh38.9 billion in relation to the 4.25% cash reserves requirement (CRR). The average interbank rate remained stable at 4.19% on May 21 compared to 4.22% on May 14.
At the T-bills auction on Thursday, May 21, Ksh26.45 billion was raised against an advertised amount of Ksh24 billion, representing a 10.2% over-subscription. However, investors shunned the re-issued Ksh30 billion 5-year bond, which raised a paltry Ksh8.9 billion.
The Kenya shilling depreciated slightly in the week, exchanging at KSh106.89 per US dollar on May 21 compared to KSh106.59 per US dollar on May 14.
