The Kenya Shilling has appreciated by 4% against the US Dollar in September 2025, marking a welcome turnaround after months of volatility in the foreign exchange market.
According to the Central Bank of Kenya (CBK), the shilling now trades at KSh 144 per USD, compared to KSh 150 earlier in the year. This rebound has been driven by increased foreign inflows, steady diaspora remittances, and government efforts to strengthen forex reserves.
📈 Why the Shilling is Rising
-
Strong Diaspora Remittances – Kenya continues to receive robust inflows from citizens abroad, boosting dollar supply.
-
Tourism Recovery – With higher international arrivals in 2025, the sector has increased foreign exchange earnings.
-
Agricultural Exports – Tea, coffee, and horticulture exports are performing well, further strengthening forex reserves.
🛒 Impact on the Economy
-
Lower Import Costs: Businesses that rely on imported goods such as fuel, machinery, and raw materials are experiencing reduced costs.
-
Inflation Control: A stronger shilling helps ease pressure on consumer prices, particularly food and fuel.
-
Investor Confidence: The stability is restoring confidence among international investors and local businesses.
⚠️ Risks Ahead
Economists warn that global oil price fluctuations and US Federal Reserve policies could still create volatility. Kenya will need to maintain prudent monetary and fiscal measures to keep the currency stable.
✅ Outlook
The shilling’s strengthening in 2025 is good news for households and businesses alike. If the trend continues, Kenya could see further inflation easing, improved trade balance, and stronger investor confidence.
