Foreign Exchange Reserves

The usable foreign exchange reserves stood at USD 6,814 million (3.60 months of import cover). This falls short of CBK’s statutory requirement to endeavour to maintain at least 4.0 months of import cover as well as the EAC region’s convergence criteria of 4.5 months of import cover.


The Kenyan Shilling depreciated against the Dollar and the Sterling Pound but appreciated against the Euro to exchange at KES 160.35, KES 203.62 and KES 174.47 respectively. The observed depreciation against the Dollar is attributed to a high demand from energy and commodity importers.

CurrencyYTD ChangeW-o-W Change
Sterling Pound1.88%0.19%


Liquidity in the money markets tightened, with the average inter-bank rate increasing from 13.44% to 13.76%, as tax remittances more than offset government payments. Remittance inflows totalled $372.60 million in December 2023, a 4.96% increase from $355.0 million in November 2023 and a 7.86% rise from $345.45 million in December 2022. Open market operations remained active.

LiquidityWeek (previous)Week (ending)
Interbank rate13.44%13.75%
Interbank volume (billion)11.8313.88
Commercial banks’ excess reserves (billion)14.6019.60

Fixed Income


T-Bills remained over-subscribed during the week, with the overall subscription rate decreasing to 146.99%, down from 241.54% recorded in the previous week. The 91-day T-Bill received the highest subscription rate at 638.95% while the 182-day T-Bill and 364-day T-Bill had subscription rates of 61.93% and 35.26% respectively. The acceptance rate increased by 22.04% to close the week at 96.77%.


In the secondary bond market, there was a higher demand for the week’s bond offers. Bond turnover increased by 71.98%, from KES 10.09 billion in the previous week to KES 17.36 billion. Total bond deals increased by 40.36% from 389 in the previous week to 546.

In the primary bond market, CBK released auction results for the 3-year bond FXD1/2024/003 and 5-year FXD1/2023/005 which sought to raise KES 15.0 billion through a tap sale. The issues received bids worth KES 11.86 billion, representing a subscription rate of 79.07%. Of these, KES 11.76 billion worth of bids were accepted at a weighted average rate of 18.39% and 18.77% respectively.


In the international market, yields on Kenya’s Eurobonds decreased by an average 0.08% compared to the previous week, but increased 0.18% month-to-date and 0.18% year-to-date. The yields on the 10-year Eurobonds for Zambia increased while that of Angola declined. Below is a summary analysis of performance for individual bonds.

BondYTD ChangeM-o-M ChangeW-o-W Change
2014 10-Year Issue0.14%0.14%-0.36%
2018 10-Year Issue0.15%0.15%-0.07%
2018 30-Year Issue0.14%0.14%0.00%
2019 7-Year Issue0.39%0.39%-0.04%
2019 12-Year Issue0.14%0.14%-0.03%
2021 13-Year Issue0.11%0.11%-0.02%

NASI, NSE 20, NSE 25 and NSE 10 settled 0.61%, 0.18%, 0.52% and 0.45% higher compared to the previous week, bringing the year-to-date performance to 1.52%, 0.52%, 1.76% and 1.66% respectively. Market capitalization also gained 0.62% from the previous week to close at KES 1.46 trillion, recording a year-to-date increase of 1.52%. The performance was driven by gains recorded by large-cap stocks such as Equity, Standard Chartered and ABSA of 1.96%, 1.86% and 1.77%. This was however weighed down by losses recorded by other large-cap stocks such as EABL, Stanbic and KCB of 1.67%, 1.57% and 1.36% respectively.

The Banking sector had shares worth KES 251M transacted which accounted for 40.73% of the week’s traded value, Manufacturing and Allied sector had shares worth KES 40.3M transacted which represented 6.53% and Safaricom, with shares worth KES 297.3M transacted represented 48.19% of the week’s traded value.

Top Gainers and Losers in the Equities Markets

Top GainersYTD ChangeW-o-W
EA Cables-2.04%9.09%
HF Group6.96%8.21%
LosersYTD ChangeW-o-W

Alternative Investments

LosersWeek (previous)Week (ending)% Change
Derivatives Turnover (million)0.461.37195.90%
Derivatives Contracts16.0014.00-12.50%
I-REIT Turnover (million)0.200.02-90.28%
I-REIT deals27.009.00-66.67%

Global and Regional Markets

Global MarketsYTD ChangeW-o-W
S&P 5002.04%1.17%
Dow Jones Industrial Average (DJI)0.39%0.72%
FTSE 100 (FTSE)-3.36%-2.14%
STOXX Europe 600-1.94%-1.58%
Shanghai Composite (SSEC)-4.39%-1.72%
MSCI Emerging Markets Index-5.25%-2.55%
MSCI World Index0.19%0.22%
Continental MarketsYTD ChangeW-o-W
FTSE ASEA Pan African Index4.33%3.16%
JSE All Share-4.31%-2.21%
NSE All Share (NGSE)24.41%13.84%
DSEI (Tanzania)-1.20%-0.82%
ALSIUG (Uganda)-0.11%-1.46%

The US stock market closed the week in the green zone, boosted by optimism surrounding AI applications and a surge in chipmaker demand, with heavyweight technology stocks leading the charge.

The European stock closed the week on a downward trajectory, as investors grappled with concerns over central bank interest rate cuts, with the focus being on the upcoming European Central Bank’s policy meeting.

The Asian stock market closed the week in the red zone, weighed down by slowing Chinese economic growth and fading hopes for early U.S. rate cuts.

Week’s Highlights

  • December revenues reached KES 1,089.52 billion, marking a remarkable 23.85% increase from the previous month, but below the monthly prorated target by 15.25%. Expenses exceeded revenue collections by KES 352 billion, signalling a fiscal deficit of 32.33%, which was financed through external and internal borrowing by 22% and 78%, respectively.
  • The IMF Board approved a $684.7 million disbursement to Kenya, providing immediate financial support and recognizing progress under its economic reform program. This disbursement includes $624.5 million under the Extended Fund Facility and Extended Credit Facility (EFF/ECF) arrangements, with an increased access of $310.6 million. It also includes $60.2 million under the Resilience and Sustainability Facility (RSF). This brings total disbursements under the EFF/ECF to $2.6 billion. However, the IMF-backed revenue measures, aiming to generate an additional KES 806 billion over three years, face potential legal challenges in the form of court battles surrounding the proposed tax policies.
  • Kenya received a $210 million boost from the Trade and Development Bank in the form of syndicated loans, providing temporary relief ahead of a significant Eurobond repayment in June. It still expects additional financial support from the Pan-African lender in the near future.
  • Heri Holdings acquired Nova Academies Tatu City Property Limited in a KES 6 billion deal, expanding its reach in the education sector. The acquisition, approved by the Competition Authority of Kenya, involves key assets like buildings, land and related infrastructure for seven Nova Pioneer schools across Kenya. This strategic move aligns with Heri Holdings’ goal to diversify its investments and is expected to lead to further upgrades and expansion of the acquired facilities.
  • Vodafone and Microsoft announced a 10-year partnership aiming to revolutionize the digital experience for over 300 million businesses and consumers across Europe and Africa. The collaboration will leverage cutting-edge generative AI, advanced cloud technologies and robust digital services to create seamless and personalized experiences. The partnership will see M-Pesa migrate to Azure and unlock new cloud-powered applications.
  • Flydubai inaugurated direct flights to Mombasa, marking the first air link between the United Arab Emirates and Kenya. Kenya’s open skies policy played a pivotal role in this historic launch, paving way for convenient travel options and unlocking a world of possibilities for tourism, trade and investment between the two regions.
  • China’s GDP grew 5.2% year-on-year in Q4 2023, up from 4.9% in Q3, but below market expectations of 5.3%. This was primarily due to an increase in industrial production. Unemployment also rose slightly, but retail sales decreased, recording their weakest growth in three months. For the full year, the economy expanded 5.2%, meeting the government’s target and marking a rebound from 2022’s 3.0% growth. However, this remains the slowest annual pace since 1990, highlighting challenges from the property slump, weak consumption, and global headwinds.
  • UK inflation increased to 4.0% in December, exceeding forecasts of 3.8% and marking the first hike since February. Alcohol and tobacco led the charge, with prices rising 12.9% year-on-year due to tax hikes, and recreation and culture costs rising 5.7%. Clothing, footwear, furniture and communication also increased. However, food and non-alcoholic beverages, health, restaurants and hotels, and transport decreased. On a monthly basis, the CPI rose 0.4%, while the core CPI, excluding volatile components, rose 0.6%.

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