Kenya’s diaspora remittances in July dropped by 0.7 per cent to KSh38.2billion compared to KSh38.5 billion sent in June.
According to the Central Bank of Kenya, the US remains the largest source of remittances in Kenya, accounting for 58 per cent in the period.
The largest source of diaspora remittances in Africa was from Tanzania, with $3.9 million. It is followed by Uganda, which contributed $2.6 million, South Africa $2.4 million, Malawi $527,000, Nigeria $508,000, Zambia $297,000, Ivory Coast $291,000, Egypt $221,000 and South Sudan $177,000.
“The strong remittances inflows continue to support the current account and the stability of the exchange rate,” said CBK in its weekly bulletin.
In a similar month, 2021, total remittances were USD 336.7 million ( KSh40.3billion), a 5.1 per cent decrease.
The cumulative inflows for the 12 months to July 2022 totalled USD3,995million compared to USD 3,442 million in the same period in 2021, an increase of 16.1 per cent.
Diaspora remittances are part of Kenya’s largest foreign exchange earner, largely contributing to the country’s forex reserves to stabilise the shilling.
The CBK noted that the usable foreign exchange reserves remained adequate at USD 7.6 bn (equivalent to 4.4-months of import cover), which is above the statutory requirement of maintaining at least 4.0-months of import cover, and the EAC region’s convergence criteria of 4.5-months of import cover.
During the week, the Kenyan shilling depreciated against the US dollar to close the week at Kshs 119.6, a 0.2% depreciation from Kshs 119.3 recorded the previous week. This is partly attributable to increased dollar demand from the oil and energy sectors against a slower supply of hard currency.
