The Central Bank of Kenya (CBK) forecasts that the country’s foreign reserves will increase significantly by the end of 2026.
These reserves are projected to reach Sh1.84 trillion ($14.28 billion), enough to cover approximately 6.2 months of the country’s imports, which is a comfortable cushion up from the Sh1.60 trillion ($12.39 billion), enough to cover 5.3 months of imports at the end of 2025.
This projection builds upon a remarkable surge of 34.8% in reserves achieved throughout 2025 alone. The driving force behind the upcoming enhancement is identified as expected capital inflows, primarily from Safaricom’s divestiture proceeds amounting to Sh203.91 billion ($1.58 billion).
This is further complemented by an upfront payment of future dividends equivalent to Sh39.88 billion ($309 million), which will boost foreign direct investment (FDI), a key component of the reserve accumulation strategy.
Why does this matter for the common mwananchi? A healthy reserve acts like a shock absorber for the economy. It gives the CBK the firepower to smooth out bumps in the foreign exchange market, helping keep the shilling stable.
When the exchange rate is more stable, the prices of imported goods, from fuel to household items, are less likely to swing wildly. It also builds confidence that the country can handle unexpected global financial shocks, creating a more stable and predictable economic environment for businesses and families alike.
