The kenya shilling continues to hit new lows in the stock exchange market and is currently retailing at Ksh.150 per US dollar.
On Tuesday, the Central Bank of Kenya governor, Kamau Thugge, was interrogated by Parliament over the unusual depreciation of the shilling versus the dollar.
Thugge identified numerous issues but claimed that demand for the dollar had led the Kenyan shilling to depreciate.
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"There is an oversupply of dollars." In August 2023, supply outpaced demand, one of the fundamental concerns that will result in a higher supply of dollars over time. Because of the increased supply, there was a slowdown in depreciation from June to September," he told the Parliamentary Finance and National Planning Committee.
The Governor of the CBK has called for structural improvements to ensure supply consistently surpasses demand.
He also stated that Kenya should invest in various forms of tourism to increase the flow of funds into the country.
Mr Thugge also urged Kenya to invest in direct foreign investments to attract foreign investors, claiming that foreign investments account for 1.7% of the country's GDP.
He also stated that imports into the country had decreased from 13.2% to 11.4%.
However, the governor stated that exports are expected to remain constant this year due to the foreign exchange, noting a slowdown in European output, contributing to the slow exchange rate.
Thugge also stated that a meeting with the International Monetary Fund (IMF) will be held next week to address financial reforms and debt financing. He quickly pointed out that the financing would not increase debt.
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