Currency loss, rising costs & low liquidity in EAC
Hiked costs, depreciating currencies, rising interest rates and lowering liquidity in the East African region coupled with exogenous conflicts. How are these challenges impacting the East African markets and what lies ahead? Carol Nampurira, Corporate Sales Manager, Energy And Infrastructure, Global Markets, Stanbic Bank joins CNBC Africa for more.
Wed, 25 Oct 2023 15:23:46 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Increased demand and high import bills have led to significant depreciation of East African currencies, with Kenya experiencing a 17.8% depreciation driven by commodity prices and FDI outflows to safe havens.
- Initiatives such as remittances and upcoming tourism seasons offer hope for stabilizing local currencies in Kenya and Tanzania, while Uganda benefits from the coffee season and positive indicators in the tourism sector.
- Liquidity tightening in the markets poses challenges, but measures such as central bank interventions and lending facilities are being utilized to address liquidity risks and stabilize the financial environment in the region.
In the midst of hiked costs, depreciating currencies, rising interest rates, and lowering liquidity in the East African region, the markets are facing significant challenges that are impacting both the economies and the businesses operating within them. These challenges are further exacerbated by exogenous conflicts, adding another layer of complexity to an already volatile situation. To shed light on the current state of affairs, Carol Nampurira, Corporate Sales Manager, Energy And Infrastructure, Global Markets, at Stanbic Bank, joined CNBC Africa for an insightful discussion on the matter. The interview delved into the factors contributing to the fluctuations in currencies across Kenya, Uganda, and Tanzania and explored potential solutions and positive developments on the horizon. Carol provided valuable insights into the root causes of the challenges faced by the East African markets and offered a glimpse into what the future might hold for these economies. As the region navigates through these turbulent times, stakeholders are looking for innovative strategies to mitigate the impact of these pressing issues.
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