Big Relief: Why Kenyans Should Expect Further US Dollar Fall Against Shilling From Wed

Big Relief: Why Kenyans Should Expect Further US Dollar Fall Against Shilling From Wed

The Kenyan shilling is expected to further strengthen against the US dollar in the coming days.

This was after the World Bank gave the green light to the disbursement of Ksh158 billion to Kenya by April 3. The approval, which came on Tuesday, March 26, under the First Kenya Fiscal Sustainability and Resilient Growth initiative, is anticipated to fortify the country’s foreign exchange reserves.

This injection of funds is expected to create a surplus in the United States dollar (USD), thereby further easing the pressure on Kenya’s need to purchase foreign currency for international trade purposes.

The World Bank’s decision to extend a USD1.2 billion loan to Kenya comes hot on the heels of the country’s successful raising of USD1.5 billion through Eurobonds merely three months ago.

These financial injections have notably propelled the Kenyan Shilling to the forefront as one of the strongest-performing currencies globally.

The World Bank said they aim to foster economic development in Kenya through trade and investment initiatives. The institution added that the loan is intended “to promote efficiency, equity, and transparency of public finance; foster more competitive and inclusive product and labor markets; and strengthen climate action.”

Commending the efforts of President William Ruto’s administration in tackling climate change, the World Bank lauds Kenya’s position as a leading African advocate on climate change issues. Notably, the institution cited Kenya’s instrumental role as an architect of the Nairobi Declaration on climate change in 2023.

In a bid to support Kenya’s climate action agenda, the World Bank’s Development Policy Financing (DPF) will aid in the enhancement of the country’s legal framework for carbon markets and the establishment of a sovereign green bond framework, according to detailed statements from the World Bank.

By Newshub

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