Shilling Hits lowest level since September 2015

As of Thursday, March 19, 2020, the shilling weakened against the dollar hitting the lowest level since September 2015. The currency was selling for 105.3 units against the dollar at around 5 p.m. compared with 104.22 units at the close of trading on Wednesday.

The weakening of the shilling has been associated with fears about the possible drop of hard currency inflows from sources such as remittances, horticulture and tourism caused by the coronavirus outbreak.

Lockdowns and travel restrictions aimed at limiting the pandemic have seen businesses that rely on export markets, such as flower growers, worry about the supply of dollars in the market.

A weaker shilling will see additional shipment costs passed on to consumers by traders from imported commodities like cars, machinery, pharmaceutical products and clothing.

It will also cut the benefits predicted in the fall of crude prices.

The first case of the coronavirus in Kenya was confirmed last Friday, causing the shilling to weaken and forcing trading on the Nairobi Stock Exchange to be halted after a steep drop.

On Friday, March 20, 2020, coronavirus confirmed cases stood at seven and the government has shut down schools indefinitely, banned large public gatherings and limited entry into the country for people from countries with high cases of the virus.

The tourism industry has seen a dip of about 88 percent of foreign travelers with the hotels recording 20 percent occupancy compared to about 75 percent this season last year.