Ramiran
Elder Lister
Wednesday September 28 2022
A unit of sterling pound has fallen
below Sh130 levels against the shilling for the first time since the peak of Covid restrictions.
SUMMARY
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A unit of sterling pound has fallen below Sh130 levels against the shilling for the first time since the peak of Covid restrictions, portending lower cost of imports from the UK, while hurting export earnings for farm produce to that European country.
The shilling opened trading on Tuesday at 129.97 units against the pound before losing a bit of ground to exchange around 130 units later in the afternoon.
The UK currency fell to a record low against the globally-bullish US dollar on Monday as markets reacted to last weekend's UK's biggest tax cuts in 50 years which have raised the cost of the UK government borrowing.
The weakening of the pound against the dollar is reflected in other markets partly because the greenback, the US currency, serves as the global benchmark in foreign exchange markets.
The shilling appreciated 3.42 percent against the pound on Monday, the biggest gain in nearly 14 years.
Central Bank of Kenya data shows the shilling last appreciated at a faster pace of 3.82 on January 20, 2009.
Trade between the two countries is tilted in favour of Kenya, meaning local exporters are net losers as the pound weakens.
Kenya National Bureau of Statistics data, for instance, show exports to the UK amounted to Sh49.4 billion last year against Sh33.6 billion in imports — a trade deficit of Sh15.8 billion.
Kenya mainly sells agricultural produce such as cut flowers, vegetables, fruits, coffee, and tea to the UK and largely buys vehicles, machinery, alcoholic beverages like spirits, pharmaceuticals and electronics.
A unit of sterling pound has fallen
below Sh130 levels against the shilling for the first time since the peak of Covid restrictions.
SUMMARY
Advertisement
A unit of sterling pound has fallen below Sh130 levels against the shilling for the first time since the peak of Covid restrictions, portending lower cost of imports from the UK, while hurting export earnings for farm produce to that European country.
The shilling opened trading on Tuesday at 129.97 units against the pound before losing a bit of ground to exchange around 130 units later in the afternoon.
The UK currency fell to a record low against the globally-bullish US dollar on Monday as markets reacted to last weekend's UK's biggest tax cuts in 50 years which have raised the cost of the UK government borrowing.
The weakening of the pound against the dollar is reflected in other markets partly because the greenback, the US currency, serves as the global benchmark in foreign exchange markets.
The shilling appreciated 3.42 percent against the pound on Monday, the biggest gain in nearly 14 years.
Central Bank of Kenya data shows the shilling last appreciated at a faster pace of 3.82 on January 20, 2009.
Trade between the two countries is tilted in favour of Kenya, meaning local exporters are net losers as the pound weakens.
Kenya National Bureau of Statistics data, for instance, show exports to the UK amounted to Sh49.4 billion last year against Sh33.6 billion in imports — a trade deficit of Sh15.8 billion.
Kenya mainly sells agricultural produce such as cut flowers, vegetables, fruits, coffee, and tea to the UK and largely buys vehicles, machinery, alcoholic beverages like spirits, pharmaceuticals and electronics.
