Kenya Economic Forecast

Kenya Economic Outlook

May 22, 2018

Kenya’s economic recovery continued to gain momentum at the outset of the second quarter against the backdrop of a stable political scene, as President Uhuru Kenyatta patched up a longstanding fall-out with Raila Odinga, the primary opposition leader. The PMI in April shot up to the highest mark since January 2016, signaling that business conditions in the private sector brightened for the third consecutive month. Exports picked up at the start of the year, growing at a double-digit pace in January and February, while imports slowed significantly, narrowing the trade deficit. Meanwhile, improved weather conditions are helping to buoy agricultural output. While the economy is showing signs of an upturn, the country’s financial stability remains fragile as the debt burden continues to mount.

Kenya Economic Growth

Economic growth is expected to accelerate this year thanks to easing monetary conditions, higher investment and a continued rise in agricultural output. Completion of phase one of the standard gauge railway between Mombasa and Nairobi should help curb import demand and narrow Kenya’s current account deficit. Moreover, the government has pledged that it will “eliminate or significantly modify” an interest rate cap on commercial bank lending rates that has stymied private sector credit growth, although the timing of its removal is still unclear. While reduced political tensions will continue to lift confidence, a tighter fiscal policy will restrain the stride at which the economy will grow. Met the why particular analysts project GDP expanding 5.5% in 2018, which is unchanged from last month’s forecast, and 5.8% in 2019.

Kenya Economy Data

20132014201520162017
Population (million)41.843.044.245.546.7
GDP per capita (USD)1,3221,4331,4271,558-  
GDP (USD bn)55.361.663.170.8-  
Economic Growth (GDP, annual variation in %)5.95.45.75.8-  
Consumption (annual variation in %)8.54.65.14.8-  
Investment (annual variation in %)1.214.86.7-9.3-  
Industrial Production (annual variation in %)5.45.36.16.0-  
Fiscal Balance (% of GDP)-6.8-7.0-9.6-8.1-  
Public Debt (% of GDP)44.545.950.453.5-  
Money (annual variation in %)13.818.612.84.8-  
Inflation Rate (CPI, annual variation in %, eop)7.26.08.06.4-  
Inflation Rate (CPI, annual variation in %)5.76.96.66.3-  
Policy Interest Rate (%)8.508.5011.5011.00-  
Exchange Rate (vs USD)86.4590.55112.3112.5-  
Exchange Rate (vs USD, aop)86.1387.9598.27111.5-  
Current Account (% of GDP)-8.1-9.8-6.8-5.2-  
Current Account Balance (USD bn)-4.5-6.0-4.3-3.7-  
Trade Balance (USD billion)-11.5-12.4-11.1-7.9-  
Exports (USD billion)5.96.15.95.7-  
Imports (USD billion)16.418.515.913.6-  
Exports (annual variation in %)-3.62.7-3.4-2.4-  
Imports (annual variation in %)0.412.6-13.8-14.4-  
International Reserves (USD)6.67.97.57.6-  
External Debt (% of GDP)24.827.130.4-  -  

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Kenya Facts

ValueChangeDate
Bond Yield13.000.0 %May 21
Bond Yield13.000.0 %May 21
Exchange Rate110.70.05 %May 21
Exchange Rate110.70.05 %May 21
Stock Market0.20.0 %May 21
Stock Market0.20.0 %May 21

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