Foreign Exchange Reserves

The CBK’s usable foreign exchange reserves remained adequate at USD 8,873 million (5.42 months of import cover). This meets CBK’s statutory requirement to endeavor to maintain at least 4.0-months of import cover, and the EAC region’s convergence criteria of 4.5-months of import cover.


The Kenyan Shilling depreciated against the Dollar and the Pound, but appreciated against the Euro. The weakening of the shilling is attributable to increased dollar demand from energy and merchandise importers.

Week BeforeWeek After
Sterling Pound150.14151.29


Liquidity in the money markets tightened, supported by tax remittances which partly offset government payments. Open market operations remained active.

Week BeforeWeek After
Interbank rate4.68%5.20%
Interbank volume (billion)9.8610.97
Commercial banks’ excess reserves (billion)10.7018.60

Fixed Income


The T-Bills became over-subscribed. The 91-day T-bill recorded the highest subscription rate, attributable to high risk-adjusted return offered by the paper.

T-BillYield (% Rate)Subscription Rate
Week BeforeWeek AfterWeek BeforeWeek After
91 day 7.07%7.11%99.76%209.94%
182 day7.68%7.75%52.02%84.76%
364 day8.75%8.84%74.34%92.00%

The bonds market had low demand for the week’s bond offers. Bonds turnover decreased to Kshs 10.60 billion from Kshs 17.94 billion recorded in the previous week.

In the international market, the yields on Eurobonds recorded mixed performance, with the 30-year bond issued in 2018 increasing by 0.1% points to 7.9%, from 7.8% recorded the previous week, while yields on the 12-year bond issued in 2021 declined by 0.1% to 6.4%, from 6.5% recorded the previous week. Yields on the 10-year bond issued in 2014, 10-year bond issued in 2018, 7-year bond issued in 2019 and 12-year bond issued in 2019 remained unchanged at 3.8%, 5.6%, 5.4% and 6.6%, respectively.


NASI, NSE 20 and NSE 25 declined by 1.77%, 1.37% and 0.67% respectively. Market capitalization also decreased by 1.77% to 2.63 trillion. The performance was driven by losses recorded by large-cap stocks. Top losses were recorded in East African Breweries Limited, Safaricom Plc, and Co-operative Bank of Kenya which declined by 3.2%, 2.4% and 2.0% respectively.

The Banking sector had shares worth Kshs 949M transacted which accounted for 37.99% of the week’s traded value, Manufacturing & Allied sector represented 7.03%, and Safaricom with shares worth Kshs 1.3B transacted, contributed 52.63%.

Top Gainers and Losers in the Equities Markets

Top GainersW-o-W
HF Group18.07%
Express Kenya8.57%
Home Afrika8.11%
Car & General7.74%
Top LosersW-o-W
Nairobi Business Ventures-28.38%
East African Portland-10.00%
Kenya Power-7.07%
WPP Scangroup-6.17%

Alternative Investments

Week BeforeWeek After% Change
Derivatives Turnover (million)5.773.92-31.99%
Derivatives Contracts5534-38.18%
I-REIT Turnover0.540.22-59.84%
I-REIT Deals39

Global and Regional Markets

Global MarketsW-o-W
S&P 5000.32%
Dow Jones Industrial Average (DJI)-1.38%
FTSE 100 (FTSE)-1.69%
STOXX Europe 600-0.14%
Shanghai Composite (SSEC)0.60%
MSCI Emerging Markets-1.26%
MSCI World Index-0.12%
Continental MarketsW-o-W
FTSE ASEA Pan African Index-2.82%
JSE All Share0.96%
NSE All Share (NGSE)-0.12%
DSEI (Tanzania)0.01%
ALSIUG (Uganda)-0.44%

European stocks closed the week lower on concerns over the economic damage from fresh COVID-19 lock downs in the region that hammered cyclical sectors such as banks and automakers. This forced investors to reassess portfolios and sell vulnerable assets such as the euro and bank stocks.

U.S. stocks ended the week mixed boosted by gains in the Technology, Consumer Goods and Utilities sectors, while losses in the Oil & Gas, Financials and Telecommunication sectors led shares lower. Investors digested the news of renewed lock downs and new restrictions announced in Austria to deal with rising cases and fears Germany could follow suit. Investors therefore sought safe havens in technology stocks.

Asia Pacific stocks closed the week high, though the investors were cautious over capped gains of Chinese shares listed in the United States of America. Strong corporate earnings in the US continue to ease concerns about inflation, monetary policy tightening, and an economic recovery from Covid-19 that is slowing down in China.

On the global commodities markets, Crude Oil WTI closed the week low by 5.72% and the ICE Brent Crude decreased by 3.99%. Gold futures prices also decreased by 0.87% to settle at $1,851.60.

Week’s Highlights

  • The National Treasury has signalled revival of the stalled scheme for affordable cooking gas involving distribution of 300,000 6kg-gas cylinders to low income households for the next three years which was introduced to cut reliance on environment-unfriendly kerosene and charcoal, which are the main source of fuel for most rural and urban poor households. This comes at a time when cooking gas has been retailing at six-year highs after the Treasury reintroduced a 16% value-added tax (VAT) on the commodity as from July 1.
  • The government has announced plans to offer a third economic stimulus package worth KSh26.2 billion to boost the recovery of key economy sectors affected by the global Covid-19 pandemic. The major targeted sectors include Agriculture, Health, Education, Drought response, Infrastructure, Financial Inclusion, Energy and Environmental Conservation. This brings the total stimulus package rolled out so far to more than Kshs 80 billion.
  • Financing of the East African Community budget based on the country’s economy size will see Kenya pay the lion’s share. The hybrid model of financing, which will be reviewed triennially, will see countries pay an equal amount for 65% of the budget while the remaining 35% will be based on the country’s GDP. This is a deviation from the current mode where partners contribute equally to the budget.
  • Shelter Afrique has received $19,218 from Gambia, increasing its stake to 0.27%. The company, which provides long-term credit lines for primary mortgage lenders, housing micro-finance institutions and re-financiers, invests in the Gambia through financing Taf Africa Global, a Pan-African real estate firm. Additional contributions were received from Tanzania ($ 3.1 million), Cameroon ($3.5 million), Mali ($ 2.1 million), Rwanda ($1.1 million), Uganda ($80,000), Togo ($0.58 million), Swaziland ($320,000), Cote d’Ivoire ($0.57 million), and the Democratic Republic of Congo ($0.5 million).
  • Credit to the mining sector declined to a six-year low despite an increase in lending to other sectors in line with the economic recovery after the Covid-19 slump. Loans to the mining sector declined by 23.1% to Kshs 10.9 billion in August compared to Kshs 14.1 billion in a similar period last year. Other sectors such as manufacturing, transport and communication, and construction registered 9.3%, 11.8% and 1.7% credit expansion to Sh437.8 billion, Sh237.9 billion and Sh121.0 billion respectively.
  • The government seeks to raise Kshs 105.6 billion in the next fiscal year through issuance of a fifth sovereign bond as part of the net external budget deficit financing amounting to Sh363 billion in the 2022/2023 fiscal year. The government, in the last seven years has issued four Eurobonds, netting a total of Sh880 billion ($7.85 billion), the latest of which was the $1 billion (Sh112 billion) raised in June this year.

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