Sharp Daily
No Result
View All Result
Saturday, September 6, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home Investments

Inflation surge in Kenya threatens investments

Editor SharpDaily by Editor SharpDaily
November 2, 2023
in Investments
Reading Time: 2 mins read

The investment landscape in Kenya is currently facing significant challenges driven by macroeconomic conditions. These conditions have been a cause for concern, affecting various investment sectors. This article delves into the key macroeconomic factors shaping the country’s investment environment.

Over the past year, the Kenyan currency has experienced a substantial decline, with the shilling losing 24.6% against the US dollar year-to-date. Additionally, the Kenya National Bureau of Statistics (KNBS) recently reported that the Consumer Price Index for October saw a month-on-month rise in inflation for the third consecutive month, increasing by 0.1 percent points to reach 6.9 percent in October, up from 6.7 percent in September.

While these inflation rates are not as high as previous years, the recent trend is a cause for concern, particularly as projections suggest that inflation is likely to continue its upward trajectory. This poses questions about how these indicators affect investors in both the Equities and Fixed Income markets.

Fixed-income securities, such as government bonds, are especially sensitive to changes in inflation rates. In recent months, the government has had to offer higher interest rates to attract investors to its securities. For instance, just two weeks ago, the 91-day Treasury bill yield surpassed 15.0%, and this trend continued in the subsequent week. The devaluation of the currency and rising inflation rates have prompted investors to demand higher returns. With inflation on the rise, there is pressure on bond yields, potentially impacting returns for bondholders. In essence, the real return on bonds is diminishing as inflation escalates.

RELATEDPOSTS

Navigating inflation and currency risks in African investments

June 10, 2025

Balancing between inflation and unemployment

May 5, 2025

The Equities Market in Kenya has not been immune to these challenges, with major companies listed on the Nairobi Securities Exchange experiencing significant declines in share values. This has resulted in capital losses for many investors.

For instance, Safaricom Ltd.’s shares dropped to KES 12.3 as of November 1, 2023, from KES 25.0 on the same date the previous year. KCB Bank also saw a significant decrease from 37.7 in November last year to 17.20 on November 1, 2023. These substantial losses are attributed to various macroeconomic factors, including currency devaluation and rising inflation rates.

Despite the challenging investment environment, many investors have demonstrated resilience. Strategies employed by investors have included diversification and adopting a long-term perspective. Given the volatility of these investment assets, another strategy gaining traction is the exploration of Real Estate and Private Equity investments, which are less susceptible to inflation and currency devaluation. In these uncertain times, attractive options for investors in these two asset classes may include inflation-protected securities and dividend-paying equities.

 

Previous Post

Controversial lease clauses cast uncertainty over Enaki Town property owners

Next Post

JKIA rolls out electric buses in partnership with Metrotrans and Super Metro

Editor SharpDaily

Editor SharpDaily

The latest in business, real estate, education, investments, tech and entrepreneurship, brought to you daily. Reach us through thesharpdaily@gmail.com

Related Posts

Analysis

Why knowing your pension exit options matters, especially in the public sector

September 5, 2025
Investments

Bank on your paycheck: Invest smart with CMMF

August 26, 2025
Analysis

AI and the future of investment research

August 22, 2025
Analysis

Why private credit gaining traction in emerging markets

August 21, 2025
Analysis

Reopened infrastructure bonds oversubscribed as investors seek higher yields

August 15, 2025
Analysis

Understanding foreign investor outflows

August 15, 2025

LATEST STORIES

September snapshot: CMMF yields 13.12% as month unfolds

September 5, 2025

Why knowing your pension exit options matters, especially in the public sector

September 5, 2025

Breaking the Silence: Understanding and Supporting Suicide Awareness Month

September 5, 2025

Strategic financial moves steer Kenya’s economic stability

September 4, 2025
Private equity investment business concept

Private equity and insurance

September 4, 2025

How reforming payroll taxes can stabilize employment trends

September 4, 2025

How public ratings could shift healthcare dynamics in Kenya

September 4, 2025

Boosting Your Retirement Savings with Additional Voluntary Contributions (AVCs)

September 4, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024