State of the Kenyan Shiling

The Kenyan shilling is the official currency of Kenya, divided into 100 cents. As of today, 1 US dollar is equal to 153.15 Kenyan shillings 1. The Kenyan shilling has been among the most stable currencies in East Africa and is often used in neighboring countries such as Sudan and Somalia . However, the exchange rate for the Kenyan shilling has generally weakened relative to the US dollar over the past decade .

Since the beginning of 2020, the Kenyan shilling has lost approximately 25% of its value against the US dollar, falling from Sh99 to Sh124 34. This means that Kenyans will need to spend 25% more shillings to buy the same amount of dollars 3. The Kenyan shilling has lost over 12% of its value locally. The ultra-aggressive taxation policy in Kenya, which includes tripling capital gains taxes from 5% to 15%, has pushed investing away while others began selling their interests to pump elsewhere 6. Furthermore, the scarcity of dollars has generated an alternate black market in Kenya, Nigeria, and many other African countries. The currency rates on the black market are much higher than those provided by central banks. People and corporations have been stockpiling dollars due to the general perception that they are a relatively stable store of value, while interest rates have been rising month after month .

In conclusion, the Kenyan shilling has been losing value against the US dollar since 2020. The ultra-aggressive taxation policy in Kenya, scarcity of dollars, and rising interest rates have contributed to the decline in value. Kenyans will need to spend more shillings to buy the same amount of dollars, and the situation is not showing any signs of slowing down