Treasury’s appetite for foreign debt seen as shilling’s biggest risk

A trader monitors an electronic currency display board at a forex bureau. FILE PHOTO | NMG

Kenya’s growing appetite for foreign debt could be the largest risk to the shilling’s stability this year as local factors including drought and prolonged politicking that dominated last year give way to external shocks.

The currency was fairly stable in the past year – barely half a percentage weaker – supported by a central bank that constantly mopped up liquidity and occasionally sold dollars to keep it hemmed in the 102.80-104.00 band to the greenback.

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