Understanding the historical exchange rates of the Kenyan Shilling (KES) against other currencies, particularly the US Dollar (USD), is crucial for economic analysis and policy-making. This data provides insights into the stability and performance of the Kenyan economy over time.
Data Sources and Collection
Real Time Prices (RTP) is a live dataset compiled and updated weekly by the World Bank Development Economics Data Group (DECDG) using a combination of direct price measurement and Machine Learning estimation of missing price data. The historical and current estimates are based on price information gathered from the World Food Program (WFP), UN-Food and Agricultural Organization (FAO), select National Statistical Offices, and are continually updated and revised as more price information becomes available.
To produce smooth price series, outliers in the data are often adjusted using non-parametric density estimation and other techniques. Generalized Auto-Regressive Conditional Heteroskedasticity models are used to estimate intra-month price ranges. These models allow for excess kurtosis using a Generalized Error Distribution (GED). Data are produced from 2007 to the present and estimates are given for individual commodity items at geo-referenced market locations.
RTP estimates of historical and current prices may serve as proxies for sub-national price inflation series or substitute national-level Consumer Price Inflation (CPI) indicators when complete information is unavailable.
Currency exchange rate is an important metric to inform economic policy but traditional sources are often produced with delay during crises and only at an aggregate level. This may poorly reflect the actual rate trends in rural or poverty-stricken areas, where large populations reside in fragile situations.
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This data set includes currency exchange rate estimates and is intended to help gain insight in price developments beyond what can be formally measured by traditional methods. The estimates are generated using a machine-learning approach that imputes ongoing subnational price surveys, often with accuracy similar to direct measurement of prices.
The RTFX data and metadata provided are "as is" and "as available," and every effort is made to ensure their timeliness, accuracy, and completeness. When errors are discovered, they are corrected as appropriate and feasible.
Historical Exchange Rate Trends
Kenya Exchange Rate against USD averaged 137.240 (USD/KES) in May 2023, compared with 134.395 USD/KES in the previous month. Kenya Exchange Rate against USD data is updated monthly, available from Jan 1957 to May 2023. The data reached an all-time high of 137.240 in May 2023 and a record low of 6.900 in Dec 1973. CEIC extends history for monthly average Exchange Rate against USD. Central Bank of Kenya provides average Exchange Rate against USD. Exchange Rate against USD prior to January 2000 is sourced from the International Monetary Fund.
The exchange rate ended 2024 at KES 129.3, compared to the end-2023 value of KES 157.0 and the figure a decade earlier of KES 90.55. It averaged KES 112.2 over the last decade.
| Year | End of Year Exchange Rate (KES/USD) |
|---|---|
| 2014 | 90.55 |
| 2023 | 157.0 |
| 2024 | 129.3 |
Factors Influencing Exchange Rates
Several factors can influence exchange rates, including interest rates, inflation, and economic stability. In Kenya, key economic indicators such as short-term interest rates and long-term interest rates play a significant role.
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In the latest reports, Kenya Short Term Interest Rate: Monthly Average: Treasury Bills Rate: 91 Days was reported at 9.760 % pa in Mar 2023. Its Long Term Interest Rate (Treasury Bonds Rate: 10 Years) was reported at 13.490 % pa in May 2022. The cash rate (Policy Rate: Month End: Central Bank Rediscount Rate) was set at 9.500 % pa in May 2023.
Figure: Inflation Rate in Kenya
Forecasting Exchange Rates
Forecasting exchange rates involves analyzing various economic indicators and trends. Regional and global forecast institutions provide insights, and averaging these forecasts can provide a more reliable estimate.
Forecasting errors tend to cancel each other out, leading to the most reliable exchange rate forecast available for Kenyan exchange rate.
How should you choose a forecaster if some are too optimistic while others are too pessimistic? regional and global forecast institutions. and averaged to provide one Consensus Forecast you can rely on for each indicator.
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