Foreign Exchange Reserves

The CBK’s usable foreign exchange reserves remained adequate at USD 8,765 million (5.36 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, the Euro and the Sterling Pound. The increase in the dollar is attributable to increased dollar demand from oil and commodity importers.

Week BeforeWeek After
Sterling Pound152.05153.11


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

Week BeforeWeek After
Interbank rate5.47%4.46%
Interbank volume (billion)14.2713.93
Commercial banks’ excess reserves (billion)10.5020.30

Fixed Income


The T-Bills subscription rate improved, but, remained under-subscribed. The improved subscription in T-Bills is attributable to improved liquidity in the money markets.

T-BillYield (% Rate)Subscription Rate
Week BeforeWeek AfterWeek BeforeWeek After
91 day 7.27%7.35%14.31%141.33%
182 day8.10%8.04%23.20%63.64%
364 day9.37%9.44%49.36%112.00%

The bonds market had low demand for the months bond offers. Bonds turnover decreased to Kshs 3.09 billion from Kshs 5.70 billion recorded in the previous week.

In the primary bond market, the Treasury reopened a bond, FXD1/2020/005 with a fixed coupon rate of 11.67%. Bids worth Ksh 28.39 billion were received against the target of Kshs 30 billion, a subscription rate of 94.64%.The government rejected high bids, and accepted bids worth Kshs 27.43 billion- an acceptance rate of 96.60%

In the international market, yields on Kenya’s Eurobonds increased by an average of 9.2 basis points. The yields on the 10-year Eurobonds for Ghana and Angola also increased.


NASI, NSE 20 and NSE 25 increased by 3.17%, 0.94% and 2.03% respectively. Market capitalization also increased by 3.18% to 2.68 trillion. The performance was driven by gains recorded by large-cap stocks. Top gains were recorded in Safaricom Plc, NCBA, Standard Chartered Bank and KCB Group which increased by 5.1%, 3.0%, 1.8% and 1.2% respectively.

The Banking sector had shares worth Kshs 607M transacted which accounted for 31.69% of the week’s traded value, Manufacturing & Allied sector represented 5.09% and Safaricom with shares worth Kshs 1.1Bn transacted, contributed 61.32%.

Top Gainers and Losers in the Equities Markets

Top GainersW-o-W
Standard Group Limited9.96%
Car & General9.13%
Top LosersW-o-W
Nairobi Business Ventures-18.48%
Olympia Capital Holdings-6.00%
Express Kenya-4.88%

Alternative Investments

Week BeforeWeek After% Change
Derivatives Turnover (million)0.942.22134.78%
Derivatives Contracts618200.00%
I-REIT Turnover0.400.60 49.74%
I-REIT Deals5076 52.00%

Global and Regional Markets

Global MarketsW-o-W
S&P 500-1.87%
Dow Jones Industrial Average (DJI)-0.29%
FTSE 100 (FTSE)1.36%
STOXX Europe 600-0.32%
Shanghai Composite (SSEC)-1.66%
MSCI Emerging Markets-0.48%
MSCI World Index-1.68%
Continental MarketsW-o-W
FTSE ASEA Pan African Index0.60%
JSE All Share0.30%
NSE All Share (NGSE)2.66%
DSEI (Tanzania)0.65%
ALSIUG (Uganda)0.35%

U.S stocks closed the week lower following a decline in Consumer Goods, Technology and Consumer Services stocks, as investors worried about looming U.S interest-rate hikes and unfolding Omicron news.

European stocks closed the week mixed, weighed down by disappointing regional economic data ahead of the release of key U.S. employment numbers for December, especially after the Federal Reserve pointed to a tight labor market as a key reason for turning hawkish in December.

Asia Pacific stocks also closed the week lower despite better-than-expected Chinese data. A global selloff in technology shares spilled into the region following the U.S.’s losses overnight, with South Korean internet services provider Kakao Corp.

On the global commodities markets, Crude Oil WTI closed the week high with 4.91% and the ICE Brent Crude increased by 5.10%. Gold futures prices decreased marginally by 1.71% to settle at $1,797.40.

Week’s Highlights

  • Stanbic Bank released the Purchasing Manager’s Index for the month of December, which increased for the third month in a row to 53.7 from 53.0 recorded in November 2021, highlighting improved business activities and continued growth of new businesses. This is the highest recording in the last 14 months.
  • Investments into African startups last year hit a record high of over $4 billion, compared to $1.5 billion in 2020, according to a report by Techcrunch. Stakeholders advocate for more early-stage funding options, whilst advising founders to understand how to navigate changing innovations into businesses.
  • The value of Kenya’s net foreign assets (NFA) declined by 87.1 billion to Sh 751.2 billion as at September 2021, as a result of increased debt appetite of dollar-denominated bonds. Thas had an adverse effect on the value of the Kenyan Shilling, thus increasing the cost of imports and consequently leading to inflation.
  • The International Monetary Fund (IMF) projects that the gross national savings in Kenya will increase marginally to 8.2% of GDP as of end of 2021, and jump to 13.2% in 2026, supported by gradual recovery of the economy. The government’s savings is also expected to improve from the current -2.9% to 6% in 2026,, amid the IMF program that aims at cutting fiscal spending in a push for consolidation of state finances.
  • Kenya’s trade deficit with Tanzania widened by 29.97% to Kshs 39.68 billion between January and September 2021, signaling improved trade ties and end of on-and-off trade disputes following regime change in Tanzania. Kenya exported pharmaceutical products, plastics, iron and steel, and largely imported cereals, wood, animal fodder and paper.
  • The number of foreign investors leaving trading at the Nairobi securities Exchange declined in 2021, offering reprieve to the equities market, although the electioneering period remains a risk. Net foreign sales stood at Kshs 12.4 billion in 2021 from Kshs 28.63 billion posted in 2020 at the onset of the pandemic when investors sought safe havens for their wealth. Easing of Covid-19 containment measures and resumption of dividend payments however, saw some investors return to the market and take advantage of the undervalued blue chip stocks.
  • Kenya has six six bilateral agreements with China as they seek to address trade barriers between the two countries to improve balance of trade. The trade deals will increase Kenya’s exports to China and improve its economy.

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