Kenya’s foreign exchange reserves declined by Ksh11.77 billion over the past week, even as remittance inflows eased and the Kenyan shilling recorded a slight weakening against major international currencies.
New data released by the Central Bank of Kenya (CBK) shows that the country’s foreign reserves fell from USD 13.240 billion to USD 13.149 billion, reflecting a decline at a time when the government is preparing to close accounts for the 2025/26 financial year.
Despite the drop, the CBK maintained that the reserves remain at healthy levels and continue to provide adequate support for the country’s external obligations. According to the regulator, the reserves are still above the equivalent of 5.6 months of import cover, which exceeds the statutory requirement of at least four months.
The latest figures also show a slowdown in remittance inflows, one of Kenya’s key sources of foreign exchange earnings. In May 2026, remittances stood at Ksh50.98 billion, down from Ksh51.45 billion recorded in April, representing a decline of approximately Ksh470 million.
The reduction was also reflected in the cumulative 12-month inflows. Data indicates that remittances for the year ending May 2026 amounted to Ksh647.7 billion, compared to Ksh650.94 billion during the same period a year earlier.
The CBK noted that remittances continue to play a critical role in supporting Kenya’s balance of payments and remain among the country’s most reliable sources of foreign exchange.
The decline comes amid reports showing that thousands of Kenyans working abroad returned home during the past year, with some citing the expiry of employment contracts and other personal reasons. While no direct link has been officially established between the returning workers and the drop in remittances, analysts say labour migration trends remain an important factor in foreign exchange flows.
Meanwhile, the Kenyan shilling weakened slightly against several major currencies over the week.
Against the US dollar, the shilling traded at Ksh129.55 compared to Ksh129.48 recorded a week earlier. It also lost ground against the British pound, the euro and the Japanese yen.
The pound exchanged at an average of Ksh173.79 compared to Ksh173.35 previously, while the euro traded at Ksh150.16 from Ksh149.77. Against the Japanese yen, the shilling weakened marginally to Ksh80.84 from Ksh80.79.
The latest developments come as policymakers continue monitoring global and domestic economic trends, with attention focused on foreign exchange stability, remittance performance and Kenya’s overall economic outlook heading into the new financial year.
