The Kenya Shilling has strengthened against the US dollar to trade at 129.29 as this year's Christmas and New Year Holiday season kicks in, the latest data from the Central Bank of Kenya (CBK) shows.

According to the CBK, the Kenya Shilling opened the week at 129.29 on Monday and Tuesday after trading at an average of 130 units against the US dollar in early December, a drop that was attributable to increased pressure from international currencies.

The Shilling's strengthening is attributed to decreased demand in US dollars and an increase in the country's forex reserves ahead of festivities, said the central bank.

"The usable foreign exchange reserves remained adequate at $9,010 million (4.6 months of import cover) as of December 19. This meets the CBK's statutory requirement to endeavor to maintain at least four months of import cover," the CBK noted in its December 20th briefing.

Additionally, Kenyans living and working abroad wired home $432.2 million in November, being a 19.2 percent increase from the $355 million send into the country during the comparable month in 2023.

Data from the CBK notes that the cumulative diaspora inflows for the 12 months to November 2024 increased by 16.7 percent to $4.87 billion compared to $4.18 billion recorded during a similar period last year.

"The remittance inflows continue to support the current account and the foreign exchange market. The US remains the largest source of remittances to Kenya, accounting for 53.5 percent in November 2024," CBK explained.

On a year-to-date basis, the Kenya Shilling gained ground by about 17.6 percent against the greenback, a turnaround from the 26.8 percent depreciation which was suffered by the local unit last year.

Against the British Pound, CBK put the shilling at 162.33 and the euro at 134.5 units Monday and at 162.01 and 134.5 on Tuesday.

Additionally, the local unit is trading at 28.42 to the Ugandan Shilling, 18.61 to Tanzania Shilling and 6.98 to South African Rand.

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