The Central Bank of Kenya (CBK) has denied the possibility of devaluing the Kenyan Shilling. Talks of the Kenyan Shilling being devalued has been linked to the ongoing bilateral trade agreement between Kenya and the United States.
Governor, Central Bank of Kenya, Patrick Njoroge says Kenya has never and will not manipulate the shilling for competitive gain and hence such concerns are “misplaced.”
It had become public knowledge that the U.S. are asking Kenya to allow market forces influences the rate of exchange of the Shilling to the dollar.
The Apex bank chief, acknowledged Washington’s demand as common. Also, such demand had been asked earlier by the International Monetary Fund (IMF) in 2018 stating that Kenya’s currency was overvalued, which drew protests from the Central Bank governor.
“Any concerns about movement and things like that I think are misplaced,” said the CBK boss.
Dr Njoroge, has previously defended Kenya from the currency manipulation tag, insisting the foreign exchange rate reflected the shilling’s true value.
“That it’s the negotiating position of the United States…It doesn’t mean that Kenya is a currency manipulator…this is not proof or a statement that Kenya is a currency manipulator,” said Dr Njoroge said.
The Central Bank has often maintained that it does not operate a managed exchange regime and is committed to a flexible exchange rate regime. The bank only intervenes to smooth out excess volatility, Dr Njoroge has often said.