The Central Bank of Kenya has been blamed for the dollar crisis, having introduced tough rules on the foreign exchange interbank market. Epra also raised the foreign exchange rate fluctuation adjustment to Ksh2.16 ($0.017) per unit, from Ksh1.85 ($0.014), blamed on the weakening shilling. Last week, commercial banks acknowledged they were facing a shortage of the dollar, with people opting to negotiate with forex bureaus for better returns. “Due to fluctuation in the exchange rate we are booking huge losses in terms of exchange rate loss,” said Johnson. In 2018, the IMF said the shilling was overvalued by 17.5 percent and reclassified it from a floating to a managed exchange rate regime.

Source: Daily Nation March 12, 2023 07:50 UTC