QUARTERLY MARKET ANALYSIS REPORT 
   
  
 
 
 
 
October – December 2019 
 
 
 
 
INSIDE 
   
1. Performance in the Real Sector .................................................................................................... 2 
2. International Markets ....................................................................................................................... 8 
3. Money Market .................................................................................................................................. 14 
4. Fiscal Performance ........................................................................................................................ 16 
5. Capital Markets ............................................................................................................................... 22 
6. Risk-related Factors ...................................................................................................................... 24 
 
 
 
 
  
1. Performance in the Real Sector   
 
a) GDP Performance 
 
Figure 1: GDP growth, inflation and stock market performance   
 7.0  3,500.00
 6.5  3,300.00
 6.0  3,100.00
 5.5  2,900.00
 5.0  2,700.00
 4.5  2,500.00
 4.0  2,300.00
 3.5  2,100.00
Quarterly GDP Growth (%) Inflation (%) NSE20 Index
 
Data source: Central Bank of Kenya; Kenya National Bureau of Statistics 
 
Figure 2: Economic performance of selected advanced and emerging markets      
7.00
Kenya Kenya
6.50
6.00 Kenya Kenya
5.50 Kenya
5.00
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
-0.50
-1.00
July-Sept 18 Oct-Dec 18 Jan-March 19 April-June 19 July-Sept 19
Kenya USA UK Japan China France Mexico Brazil S. Africa
 
Data Source: Country statistical offices; https://tradingeconomics.com/   
 
2 
 
Year-On-Year GDP Growth Rate (%) Inflation and Quarterly GDP (%)
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
NSE20 Insex
Figure 3: Cement production and consumption (‘000 MT) and index of value of building 
plans   
510.00 292.00
500.00 260.00
490.00 228.00
480.00 196.00
470.00 164.00
460.00 132.00
450.00 100.00
Cement Production (000' MT) Cement Consumption ('000 MT)
Index of Value of Building Plans (Dec 1972=100)
 
Data source: Kenya National Bureau of Statistics 
 
 
Figure 4: Kenya Housing and Property Indices     
460 130
450
440 125
430
420 120
410
400 115
390
380 110
370
360 105
Hass Composite Property Sales Index Hass Composite Property Rental Index
KBA Housing Price Index (Fixed Base) KBA Housing Price Index (Moving Base)
 
Hass Composite Property Sales Index: Year 2000 = 100; KBA Housing Price Index (fixed base): Q1 – 2013 = 100.  
Data Source: Hass Property Index (http://hassconsult.co.ke/real-estate/hass-index/ )  
Kenya Bankers Association (https://www.kba.co.ke/house_price.php)  
 
3 
 
Hass Composite Index Cement Production & Consumption ('000 MT)
Jul-18
Jul-18
Aug-18
Aug-18
Sep-18
Sep-18
Oct-18
Oct-18
Nov-18
Nov-18
Dec-18 Dec-18
Jan-19 Jan-19
Feb-19 Feb-19
Mar-19 Mar-19
Apr-19 Apr-19
May-19
May-19
Jun-19
Jun-19
Jul-19
Jul-19
Aug-19
Aug-19
Sep-19
Sep-19
KBA Housing Price Index Index of Value of Building Plans)
Figure 5: Intake of processed milk in the formal sector (million litres)     
 70.00
 65.00
 60.00
 55.00
 50.00
 45.00
 40.00
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Milk Intake in 2018 Milk Intake in 2019
 
Data source: Kenya National Bureau of Statistics 
 
 
Figure 6: Monthly tourist arrivals* (number)   
215,000
205,000
195,000
185,000
175,000
165,000
155,000
145,000
135,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Tourist Arrivals in 2018 Tourist Arrivals in 2019
 
Data source: Kenya National Bureau of Statistics; Kenya Tourism Research Institute; Central 
Bank of Kenya.   
*Total tourist arrivals (air, cruise and cross-border);     
 
4 
 
Number of Tourists Milk Intake (Million Litres)
b) Price movement 
 
Figure 7: Consumer Price Index and Producer Price Index  
 210.00 121.5
 205.00 120.9
 200.00 120.3
 195.00 119.7
 190.00 119.1
 185.00 118.5
Producer Price Index Consumer Price Index
 
Data source: Kenya National Bureau of Statistics 
 
Figure 8: Comparative Inflation for selected Countries in Africa     
 22.00
 20.00
 18.00
 16.00
 14.00
 12.00
 10.00
 8.00
 6.00
 4.00
 2.00
 -
 (2.00)
 (4.00)
 (6.00)
 (8.00)
 (10.00)
Kenya Uganda Tanzania Rwanda Burundi S. Africa
Namibia Zambia Ghana Nigeria Ethiopia
 
Data Source: Country statistical offices  
5 
 
Inflation (%) Consumer Price Index
Jul-18 Jun-18
Aug-18 Jul-18
Sep-18 Aug-18
Sep-18
Oct-18
Oct-18
Nov-18
Nov-18
Dec-18 Dec-18
Jan-19 Jan-19
Feb-19
Feb-19
Mar-19
Mar-19
Apr-19
Apr-19
May-19
May-19 Jun-19
Jun-19 Jul-19
Aug-19
Jul-19
Sep-19
Aug-19
Oct-19
Sep-19 Nov-19
Oct-19 Dec-19
Nov-19
Dec-19
Producer Price Index
 
Figure 9: Domestic wholesale agriculture commodity prices  
100.00
80.00
60.00
40.00
20.00
0.00
Kales Index Cereals Index Legumes Index
Tubers Index Fruits & Vegetables Index
 
Data source: Index calculated by KIPPRA using data from Ministry of Agriculture 
 
 
Figure 10: Contribution of selected CPI Baskets to overall Inflation (%)  
 5.00  19.00
 4.50  17.33
 4.00  15.67
 3.50  14.00
 3.00  12.33
 2.50  10.67
 2.00  9.00
 1.50  7.33
 1.00  5.67
 0.50  4.00
 -  2.33
 (0.50)  0.67
 (1.00)  (1.00)
Food & Non-Alcoholic Beverages Clothing & Foot-wear
Housing, Water, Electricity, Gas and other Fuels Health
Fuel Inflation
 
Data Source: Central Bank of Kenya     
 
6 
 
Contribution to Overall Inflation (%) Monthly Wholesale Food Price Index
Jul-18
Jul-18
Aug-18
Aug-18
Sep-18
Sep-18
Oct-18
Oct-18
Nov-18
Nov-18
Dec-18
Jan-19 Dec-18
Feb-19 Jan-19
Mar-19 Feb-19
Apr-19 Mar-19
May-19 Apr-19
Jun-19
May-19
Jul-19
Jun-19
Aug-19
Jul-19
Sep-19
Aug-19
Oct-19
Sep-19
Nov-19
Oct-19
Dec-19
Nov-19
Dec-19
Fuel Inflation (%)
Figure 11: Average domestic pump prices and global crude oil prices  
 120.00  82.00
 115.00  79.00
 110.00  76.00
 105.00  73.00
 100.00  70.00
 95.00  67.00
 90.00  64.00
 85.00  61.00
 80.00  58.00
Motor Gasoline Premium Light Diesel Oil (Gasoil)
Illuminating Kerosene ADNOC Crude Oil Prices
 
Data Source: Kenya National Bureau of Statistics; Energy and Petroleum Regulatory Authority;  
https://oilprice.com/oil-price-charts/block/50 
  
7 
 
Average Local Retail Price (KSh./Ltr)
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
ADNOC Crude Oil Prices (US$ / Barrel)
2. International Markets  
 
Figure 12: Trends in coffee and tea production (metric tonnes), exports (Ksh millions) 
and auction prices (KSh/Kg)  
 
Figure 12(a): Monthly coffee production (MT)   
 6,000.00
 5,500.00
 5,000.00
 4,500.00
 4,000.00
 3,500.00
 3,000.00
 2,500.00
 2,000.00
 1,500.00
 1,000.00
 500.00
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Kenya Coffee Production (2018) Kenya Coffee Production (2019)
 
Data source: Kenya National Bureau of Statistics; Nairobi Coffee Exchange 
(http://nairobicoffeeexchange.co.ke/); 
 
Figure 12(b): Monthly coffee exports (KSh. Million)   
 3,500.00
 3,250.00
 3,000.00
 2,750.00
 2,500.00
 2,250.00
 2,000.00
 1,750.00
 1,500.00
 1,250.00
 1,000.00
 750.00
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Kenya Coffee Exports (2018) Kenya Coffee Exports (2019)
 
Data source: Kenya National Bureau of Statistics; Nairobi Coffee Exchange 
(http://nairobicoffeeexchange.co.ke/); 
8 
 
Coffee Exports (KSh. Million) Coffee Production (MT)
 
Figure 12(c): Comparison between global coffee exports (MT) and Kenya coffee exports 
(% of global total exports)  
 720,000  1.00
 700,000  0.90
 680,000  0.80
 660,000  0.70
 640,000  0.60
 620,000  0.50
 600,000  0.40
 580,000  0.30
 560,000  0.20
 540,000  0.10
 520,000  -
Global Coffee Exports Kenya Coffee Exports
 
Data source: Kenya National Bureau of Statistics; Nairobi Coffee Exchange 
(http://nairobicoffeeexchange.co.ke/); International Coffee Organization 
(http://www.ico.org/coffee_prices.asp)  
 
Figure 12(d): Monthly Kenya coffee auction prices (KSh/Kg)   
 600.0
 550.0
 500.0
 450.0
 400.0
 350.0
 300.0
 250.0
 200.0
 150.0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Kenya Coffee Auction Prices (2018) Kenya Coffee Auction Prices (2018)
 
Data source: Kenya National Bureau of Statistics; Nairobi Coffee Exchange 
(http://nairobicoffeeexchange.co.ke/).   
9 
 
Coffee Auction Prices (KSh./Kg) Global Coffee Exports (MT)
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Kenya Coffee Exports (% of global exports)
 
Figure 12(e): Monthly tea production (MT)  
 52,000.00
 49,000.00
 46,000.00
 43,000.00
 40,000.00
 37,000.00
 34,000.00
 31,000.00
 28,000.00
 25,000.00
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Kenya Tea Production (2018) Kenya Tea Production (2019)
 
Data source: Kenya National Bureau of Statistics; East African Tea Trade Association 
 
 
Figure 12(f): Monthly tea exports (MT)  
 15,500.00
 14,500.00
 13,500.00
 12,500.00
 11,500.00
 10,500.00
 9,500.00
 8,500.00
 7,500.00
 6,500.00
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Kenya Tea Exports (2018) Kenya Tea Exports (2019)
 
Data source: Kenya National Bureau of Statistics; East African Tea Trade Association 
 
10 
 
Tea Exports (KSh. Million) Tea Production (MT)
Figure 12(g): Top ten importers** of Kenyan tea by market share (%), 2014 - 2018 
40.00
35.00
30.00
25.00
20.00
15.00
10.00
5.00
0.00
2014 2015 2016 2017 2018
PAKISTAN EGYPT UK UAE SUDAN RUSSIA YEMEN AFGHANISTAN KAZAKHSTAN POLAND
 
Data source: East African Tea Trade Association (https://www.eatta.com/kenya-tea-export-data)  
**These account for 88% of tea exports from Kenya.   
 
 
Figure 12(h): Comparison between Kenya and global tea auction prices (KSh/Kg)   
 260.00  260.00
 250.00  253.75
 240.00  247.50
 230.00  241.25
 220.00  235.00
 210.00  228.75
 200.00  222.50
 190.00  216.25
 180.00  210.00
Kenya Tea Auction Prices Global Tea Prices
 
Data source: Kenya National Bureau of Statistics; Mombasa Tea Auction 
https://www.indexmundi.com/commodities/?commodity=tea;  
https://ycharts.com/indicators/world_tea_price 
11 
 
Share of Tea Exports (%)
Kenya Tea Auction Prices (KSh./Kg)
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Global Tea Prices (KSh./Kg)
 
Figure 13: The exchange rate of Kenya shilling to global currencies  
 140.00  150.00
 130.00  140.00
 130.00
 120.00
 120.00
 110.00
 110.00
 100.00
 100.00
 90.00  90.00
 80.00  80.00
US Dollar Index KES/USD KES/STG-POUND KES/EURO
 
Data source: Central Bank of Kenya; Kenya National Bureau of Statistics; 
https://www.investing.com/quotes/us-dollar-index-historical-data 
 
 
Figure 14: The exchange rate of Kenya shilling to regional currencies  
0.1200  7.7000
0.1100  7.5800
0.1000  7.4600
0.0900  7.3400
0.0800  7.2200
0.0700  7.1000
0.0600  6.9800
0.0500  6.8600
0.0400  6.7400
0.0300  6.6200
0.0200  6.5000
KES/UGX KES/TZS KES/RWF KES/BIF KES/SA-Rand
 
Data source: Central Bank of Kenya  
 
12 
 
Units of KES to 1 USH, TSH, RWF, BIF Units of KES 1 to 1 USD, STG-Pound, Euro 
02-Jul-18 02-Jul-18
23-Jul-18 23-Jul-18
13-Aug-18 13-Aug-18
03-Sep-18 03-Sep-18
24-Sep-18 24-Sep-18
15-Oct-18 15-Oct-18
05-Nov-18 05-Nov-18
26-Nov-18 26-Nov-18
17-Dec-18 17-Dec-18
07-Jan-19 07-Jan-19
28-Jan-19 28-Jan-19
18-Feb-19 18-Feb-19
11-Mar-19 11-Mar-19
01-Apr-19 01-Apr-19
22-Apr-19 22-Apr-19
13-May-19 13-May-19
03-Jun-19 03-Jun-19
24-Jun-19 24-Jun-19
15-Jul-19 15-Jul-19
05-Aug-19 05-Aug-19
26-Aug-19 26-Aug-19
16-Sep-19 16-Sep-19
07-Oct-19 07-Oct-19
28-Oct-19 28-Oct-19
18-Nov-19 18-Nov-19
09-Dec-19 09-Dec-19
30-Dec-19 30-Dec-19
Units of KES to 1 SA-Rand US Dollar Index
Figure 15: Performance of select currencies against the US Dollar  
27.00
25.00
23.00
21.00
19.00
17.00
15.00
13.00
11.00
9.00
7.00
5.00
3.00
1.00
-1.00
-3.00
-5.00
Dec2016-Dec2017 Dec2017-Dec2018 Dec2018-Dec2019
USD/KES USD/UGX USD/TZS USD/RWF USD/BIF USD/SA-Rand
USD/NAD USD/ZMW USD/GHS USD/NGN USD/ETB US Dollar Index
 
Data source: Country Statistics Offices; https://www.investing.com   
Percentage change in currencies against the US Dollar measured as end of period changes.  
USD-US Dollar; KES - Kenyan Shilling; UGX-Ugandan Shilling; TZS-Tanzanian Shilling; RWF-Rwandan Franc; BIF-
Burundian Franc; SA-South Africa; NAD-Namibian Dollar; ZMW-Zambian Kwacha; GHS-Ghanaian Cedi; NGN-
Nigerian Naira; ETB-Ethiopian Birr.  
 
 
Figure 16: Months of import cover and diaspora remittances  
 6.50 298.0
 6.30 284.5
 6.10 271.0
 5.90 257.5
 5.70 244.0
 5.50 230.5
 5.30 217.0
 5.10 203.5
 4.90 190.0
Diaspora Remittances Months of Import cover
 
Data Source: Central Bank of Kenya  
  
13 
 
Months of Import Cover % Change in Currentcy against the US$
Jul-18 USD/KES
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19 USD/KES
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
USD/KES
Sep-19
Oct-19
Nov-19
Dec-19
Diaspora Remitances (USD Million)
3. Money Market  
 
Figure 17: Interbank rate and volume, Repo and interest rates  
Central Bank Rate (%) Repo and Reverse Repos
9.10 12.00
11.00
9.00 10.00
8.90 9.00
8.00
8.80 7.00
6.00
8.70 5.00
4.00
8.60
3.00
8.50 2.00
8.40
Repo (7-days) % Reverse Repos (%)
Interbank Rate and Volume Commercial Bank Rates (%)
12.00 45000 14.00
40000 13.00
10.00
35000 12.00
8.00 30000 11.00
10.00
25000
6.00 9.00
20000
8.00
4.00 15000
7.00
10000
2.00 6.00
5000 5.00
0.00 0 4.00
Volume (KSh. Million) Weighted Average Rate (%) Deposit Rate Savings Rate Lending Rate
 
Data source: Central Bank of Kenya 
 
Figure 18: Treasury bill weighted average rate (%) 
11.0
10.5
10.0
9.5
9.0
8.5
8.0
7.5
7.0
6.5
6.0
91-Day 182-Day 364-Day
 
Data source: Central Bank of Kenya 
 
14 
 
Interbank Weighted Average Rate (%)
Weighted Average Rate (%)
Jul-18
02-Jul-18
23-Jul-18 Aug-18
13-Aug-18
03-Sep-18 Sep-18
02-Jul-18 24-Sep-18
Oct-18
15-Oct-18
23-Jul-18 05-Nov-18 Nov-18
26-Nov-18
13-Aug-18 17-Dec-18 Dec-18
07-Jan-19
28-Jan-19 Jan-19
03-Sep-18 18-Feb-19
Feb-19
11-Mar-19
24-Sep-18 01-Apr-19 Mar-19
22-Apr-19
15-Oct-18 13-May-19 Apr-19
03-Jun-19
May-19
24-Jun-19
05-Nov-18 15-Jul-19
Jun-19
05-Aug-19
26-Nov-18 26-Aug-19 Jul-19
16-Sep-19
17-Dec-18 07-Oct-19 Aug-19
28-Oct-19
Sep-19
07-Jan-19 18-Nov-19
09-Dec-19 Oct-19
30-Dec-19
28-Jan-19 Nov-19
18-Feb-19 Dec-19Volume (KSh. Million)
11-Mar-19
01-Apr-19
Jul-18
22-Apr-19 Jul-18
Aug-18
Aug-18
13-May-19
Sep-18
Sep-18
03-Jun-19 Oct-18
Oct-18
24-Jun-19 Nov-18
Nov-18
Dec-18
15-Jul-19 Dec-18
Jan-19
05-Aug-19 Jan-19
Feb-19
26-Aug-19 Feb-19 Mar-19
Mar-19
16-Sep-19 Apr-19
Apr-19
07-Oct-19 May-19
May-19
Jun-19
28-Oct-19
Jun-19
Jul-19
18-Nov-19 Jul-19
Aug-19
09-Dec-19 Aug-19 Sep-19
Sep-19
30-Dec-19 Oct-19
Figure 19: Commercial banks’ excess reserves (%) in relation to the 5.25% CRR 
6.10
6.02
6.00
5.89
5.90
5.87
5.80
5.77
5.70 5.71
5.68 5.64
5.60
5.56 5.57
5.50 5.50
5.44
5.40 5.39
5.38 5.38
5.30
 
Data source: Central Bank of Kenya;  
CRR = Cash Reserves Requirement  
 
 
Figure 20: Mobile money transactions  
 180.00  380.00
 160.00  370.00
 140.00  360.00
 120.00  350.00
 100.00  340.00
 80.00  330.00
 60.00  320.00
 40.00  310.00
 20.00  300.00
 -  290.00
Mobile Money Subscriptions (Millions) Number of Transactions (Millions)
Value of Transactions (KSh Billion)
 
Data source: Kenya National Bureau of Statistics;  
Note: The mobile money subscriptions exceed total adult population since this is based on registered SIM Cards in 
transacting electronic gadgets (Individual mobile phones and Point of Sale gadgets). In addition, 30% of mobile users 
in Kenya own more than 1 SIM Card (https://www.ca.go.ke).  
15 
 
Subscriptiosn and Transactions (Number)
Commercial banks’ excess reserves (%) in relation to  
the  5.25% CRR
Jul-18
Nov-18
Aug-18
Dec-18
Sep-18
Jan-19
Oct-18
Nov-18 Feb-19
Dec-18 Mar-19
Jan-19
Apr-19
Feb-19
May-19
Mar-19
Jun-19
Apr-19
May-19 Jul-19
Jun-19 Aug-19
Jul-19
Sep-19
Aug-19
Oct-19
Sep-19
Nov-19
Dec-19
Value of Transactions (KSh. Billion)
 
Figure 21: Kenyan banking sector performance  
51.5 14.00
51.0
12.00
50.5
50.0 10.00
49.5
8.00
49.0
6.00
48.5
48.0 4.00
47.5
2.00
47.0
46.5 0.00
Return on Asset Liquidity Ratio (%) Ratio of Gross NPL/Gross loans
 
Data Source: Calculated using data from Central Bank of Kenya  
 
 
Figure 22: Banking sector credit   
 35.00  7.00
 30.00  6.00
 25.00  5.00
 20.00  4.00
 15.00  3.00
 10.00  2.00
 5.00  1.00
Pubilc Sector Proportion of Banking sector credit (%)
Manufacturing sector credit proportion of Banking sector credit (%)
Private Sector Credit Growth (%)
 
Data Source: Central Bank of Kenya 
 
16 
 
Public and Manufacturign sector proportion of Liquidity Ratio (%)
Banking sector credit (%)
Jul-18 2.05
Jul-18 Aug-18 2.28
Aug-18 Sep-18 2.61
Sep-18 Oct-18 2.87
Oct-18 Nov-18 3.25
Nov-18 Dec-18 3.43
Dec-18 Jan-19 0.30
Jan-19 Feb-19 0.56
Feb-19
Mar-19 0.96
Mar-19
Apr-19 1.23
Apr-19
May-19 1.52
May-19
Jun-19 1.82
Jun-19
Jul-19 2.09
Jul-19
Aug-19 2.35
Aug-19
Sep-19 2.61
Sep-19
Oct-19 2.92
Oct-19
Return on Assets and Ratio of Gross NPL to Gross 
Private Sector Credit Growth (%) Loans
Figure 23: Monetary policy stance for selected countries in Africa   
 18.00
 17.00
 16.00
 15.00
 14.00
 13.00
 12.00
 11.00
 10.00
 9.00
 8.00
 7.00
 6.00
 5.00
 4.00
Kenya Uganda Tanzania Rwanda
Ghana Nigeria Zambia S. Africa
 
Source: Country Central Banks  
  
17 
 
Policy Rate (%)
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
4. Fiscal Performance  
 
Figure 24: Fiscal deficit and county transfers (KSh. Billion)  
500
400
300
200
100
0
-100
-200
-300
-400
-500
-600
-700
Fiscal Deficit 2016/17 County Transfer 2016/17 Fiscal Deficit 2017/18 County Transfer 2017/18
Fiscal Deficit 2018/19 County Transfer 2018/19 Fiscal Deficit 2019/20
 
Data Source: Central Bank of Kenya 
 
 
Figure 25: Monthly utilization of revenue against target  
Revenue Exchequer Issues to National Government
2,700.00 2,700.00 2,350.00 2,500.00
2,650.00 2,400.00 2,300.00
2,600.00 2,100.00 2,000.002,250.00
2,550.00 1,800.00
2,200.00 1,500.00
2,500.00 1,500.00
2,150.00
2,450.00 1,200.00
2,100.00 1,000.00
2,400.00 900.00
2,050.00
2,350.00 600.00 500.00
2,300.00 300.00 2,000.00
2,250.00 0.00 1,950.00 0.00
Actual Revenue Target Revenue Actual Issues to National Government Target Issues to National Government
Exchequer Issues to County Governments Exchequer Balance as a % of Actual Revenue (%)
360.00 350.00 60.00
350.00 300.00 50.00
250.00
340.00
40.00
200.00
330.00
150.00 30.00
320.00
100.00
20.00
310.00 50.00
300.00 0.00 10.00
0.00
Actual Issues to County Governments Target Issues to County Governments
 
Data Source: Monthly Gazette Notices, The National Treasury and Planning  
 
18 
 
Target Issues (KSh. Billion) Target Revenue (KSh. Billion)
Jun-18 Jun-18
Jul-18 Jul-18 July
Aug-18 Aug-18
Sep-18 Sep-18
Oct-18 Oct-18
Nov-18 Nov-18 August
Dec-18 Dec-18
Jan-19 Jan-19
Feb-19 Feb-19
Mar-19 Mar-19 September
Apr-19 Apr-19
May-19 May-19
Jun-19 Jun-19
Jul-19 Jul-19 October
Aug-19 Aug-19
Sep-19 Sep-19
Oct-19 Oct-19
Nov-19 Nov-19 November
Actual Issues (KSh. Billion) Actual Revenue (KSh. Billion)
December
Target Issues (KSh. Billion)
Jun-18
January
Jul-18
Jun-18
Aug-18 Jul-18
Sep-18 Aug-18
Sep-18 February
Oct-18
Oct-18
Nov-18
Nov-18
Dec-18 Dec-18
March
Jan-19 Jan-19
Feb-19
Feb-19
Mar-19
Mar-19 Apr-19
April
Apr-19 May-19
Jun-19
May-19
Jul-19
Jun-19
Aug-19 May
Jul-19 Sep-19
Aug-19 Oct-19
Nov-19
Sep-19
June
Oct-19
Nov-19 Actual Issues (KSh. Billion)
Figure 26: Composition of Government Revenue (KSh Billion)  
 5,000.00
 4,500.00
 4,000.00
 3,500.00
 3,000.00
 2,500.00
 2,000.00
 1,500.00
 1,000.00
 500.00
 -
July-Sept 2018 Oct-Dec 2018 Jan-March 2019 April-June 2019 July-Sept 2019
Tax Revenue Non-Tax Revenue Grants Total Revenue
 
Data Source: Calculated using data from Central Bank of Kenya  
 
 
Figure 27: Growth in tax revenue (%) and quarterly GDP growth (%) 
12
11
10
9
8
7
6
5
4
3
2
1
0
Q3-2017 - Q3-2018 Q4-2017 - Q4-2018 Q1-2018 - Q1-2019 Q2-2018 - Q2-2019 Q3-2018 - Q3-2019
Nominal Quarterly GDP Growth Nominal Tax Revenue Growth
 
Data Source: Kenya National Bureau of Statistics and Central Bank of Kenya 
 
19 
 
Growth in Tax Revenue and Quarterly GDP (%) Revenue (KSh. Billion)
633.25 
70.00 
5.08 
708.33 
1,676.47 
227.01 
23.29 
1,926.75 
2,723.78 
391.03 
38.57 
3,153.38 
3,884.79 
587.45 
69.68 
4,541.92 
697.44
59.42
5.72
781.01
Figure 28: Total debt (KSh. Billion) and proportionate shares of domestic and foreign debt  
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
Domestic debt Public & Publicly Guaranteed External debt Total Debt
 
Data Source: Calculated using data from Central Bank of Kenya 
 
 
Figure 29: Composition of government domestic debt by instrument (%)   
100%
90%
80%
70%
60.45 60.53 61.34 62.48 63.49 65.65
60%
50%
40%
30%
20% 36.93 37.26 36.30 35.78 33.55 31.36
10%
0%
July-Sept 2018 Oct-Dec 2018 Jan-March 2019 April-June 2019 July-Sept 2019 Oct-Dec 2019
Treasury Bills (excluding Repos) Treasury Bonds CBK Overdraft to Govt Other domestic debt
 
Data Source: Calculated using data from Central Bank of Kenya  
 
 
20 
 
KSh. Billions
Jun-18 49.19% 50.81%
Sep-18 49.37% 50.63%
Dec-18 48.34% 51.66%
Mar-19 49.79% 50.21%
Jun-19 47.96% 52.04%
Sep-19 47.86% 52.14%
Figure 30: Composition of government domestic debt by holder (%)  
100%
4.48 4.54 4.49 4.47 4.27 4.35
90%
80% 26.90 27.43 27.56 27.94 28.34 28.39
70%
7.18 7.46 7.26 7.06 7.06 6.99
60%
6.15 6.05 6.10 6.19 6.18 6.51
50%
40%
30%
52.27 54.49 54.60 54.33 54.15 53.77
20%
10%
0%
July-Sept 2018 Oct-Dec 2018 Jan-March 2019 April-June 2019 July-Sept 2019 Oct-Dec 2019
Banking Institutions Insurance Companies Parastatals Pension Funds Other investors
 
Data Source: Calculated using data from Central bank of Kenya  
 
 
Figure 31: Composition of external debt: proportionate shares of bilateral, multilateral, 
commercial bank and export credit  
100.00
90.00
80.00
70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
July-Sept 2018 Oct-Dec 2018 Jan-March 2019 April-June 2019 July-Sept 2019
Bilateral Multilateral Commercial Banks Export Credit
 
Data Source: Calculated using data from Central bank of Kenya  
 
  
21 
 
% of External Debt
31.18 33.19 34.99
31.92 33.05 34.41
34.17 31.22 34.00
33.89 31.00 34.53
32.72 32.51 34.22
5. Capital Markets  
 
Figure 32: Bond volumes traded (Ksh millions) and FTSE NSE Kenya government bond 
price Index  
99.00 100000.00
98.50 91200.00
98.00 82400.00
97.50 73600.00
97.00 64800.00
96.50 56000.00
96.00 47200.00
95.50 38400.00
95.00 29600.00
94.50 20800.00
94.00 12000.00
FTSE NSE Govt Bond Price Index Bond Volumes Traded (KSh. Million)
 
Data Source: Nairobi Securities Exchange; Central Bank of Kenya 
 
 
Figure 33: The 10-year Kenya Eurobond (2024) yield (%)  
8.500
8.000
7.500
7.000
6.500
6.000
5.500
5.000
4.500
 
Data Source: Central Bank of Kenya 
 
22 
 
Yield (%) FTSE NSE Kenya Government Bond Price Index
02-Jul-18
20-Jul-18 Jul-18
07-Aug-18 Aug-18
25-Aug-18
Sep-18
12-Sep-18
30-Sep-18 Oct-18
18-Oct-18 Nov-18
05-Nov-18
23-Nov-18 Dec-18
11-Dec-18 Jan-19
29-Dec-18
Feb-19
16-Jan-19
03-Feb-19 Mar-19
21-Feb-19 Apr-19
11-Mar-19
29-Mar-19 May-19
16-Apr-19 Jun-19
04-May-19
Jul-19
22-May-19
09-Jun-19 Aug-19
27-Jun-19 Sep-19
15-Jul-19
02-Aug-19 Oct-19
20-Aug-19 Nov-19
07-Sep-19
Dec-19
25-Sep-19
13-Oct-19
31-Oct-19
18-Nov-19
06-Dec-19
Bond Volumes Traded (KSh. Million)
24-Dec-19
Figure 34: Stock market performance  
3500.00
3300.00
3100.00
2900.00
2700.00
2500.00
2300.00
2100.00
1900.00
NSE20 Index Mkt Cap (KSh Bn)
 
Data Source: Nairobi Securities Exchange 
 
 
Figure 35: Stock value turnover ratio (%)  
0.300
0.250
0.200
0.150
0.100
0.050
0.000
 
Data Source: Nairobi Securities Exchange; Calculated as equity turnover value (Ksh million)/ 
Market capitalization (Ksh million)   
 
23 
 
Stock Turnover Ratio (%)
02-Jul-18
02-Jul-18 23-Jul-18
23-Jul-18 13-Aug-18
13-Aug-18
03-Sep-18
03-Sep-18
24-Sep-18
24-Sep-18
15-Oct-18
15-Oct-18
05-Nov-18
05-Nov-18
26-Nov-18
26-Nov-18
17-Dec-18
17-Dec-18
07-Jan-19
07-Jan-19
28-Jan-19
28-Jan-19
18-Feb-19
18-Feb-19
11-Mar-19
11-Mar-19
01-Apr-19
01-Apr-19
22-Apr-19
22-Apr-19
13-May-19
13-May-19
03-Jun-19
03-Jun-19
24-Jun-19 24-Jun-19
15-Jul-19 15-Jul-19
05-Aug-19 05-Aug-19
26-Aug-19 26-Aug-19
16-Sep-19 16-Sep-19
07-Oct-19 07-Oct-19
28-Oct-19 28-Oct-19
18-Nov-19 18-Nov-19
09-Dec-19 09-Dec-19
30-Dec-19 30-Dec-19
Figure 36: Foreign trading in the stock market  
 23,500.00  160.00
 21,500.00  144.00
 19,500.00  128.00
 17,500.00  112.00
 15,500.00  96.00
 13,500.00  80.00
 11,500.00  64.00
 9,500.00  48.00
 7,500.00  32.00
 5,500.00  16.00
 3,500.00  -
Foreign Purchases (FP) Foreign Sales (FS)
Equity Market Turnover (ET) Average Foreign Participation to Equity Turnover (%)
 
Data Source: Central Bank of Kenya; AIB Capital Ltd (http://www.aibcapital.com/research).  
 
 
Figure 37: Stock market performance of selected advanced and emerging markets      
 
Figure 37(a): USA stock markets  
14,000 29,000
13,000 28,000
12,000 27,000
11,000 26,000
10,000 25,000
9,000 24,000
8,000 23,000
7,000 22,000
6,000 21,000
NYSE Composite Nasdaq 100 Index (NDX) Dow Jones Industrial Average (DJIA)
 
Data source: Country Stock Exchanges; http://www.investing.com  
 
24 
 
Foreign Purchases & Sales, Equity Turnover (KSh. 
NYSE Composite & Nasda 100
Million)
Jul-18
Aug-18 Jul-18
Sep-18 Aug-18
Oct-18 Sep-18
Oct-18
Nov-18
Nov-18
Dec-18
Dec-18
Jan-19
Jan-19
Feb-19
Feb-19
Mar-19
Mar-19
Apr-19
Apr-19
May-19
May-19
Jun-19
Jun-19
Jul-19
Jul-19
Aug-19
Aug-19
Sep-19
Sep-19
Oct-19
Oct-19
Nov-19
Nov-19
Dec-19
Dec-19
Dow Jones Industrial Average
Average Foreign Participation to Equity Turnover (%)
Figure 37(b): European stock markets  
8,000 1,200
7,500 1,167
7,000 1,133
6,500 1,100
6,000 1,067
5,500 1,033
5,000 1,000
4,500 967
4,000 933
3,500 900
London Stock Exchange Group PLC (LSE) EuroNext 100 (N100)
 
Data source: Country Stock Exchanges; http://www.investing.com  
 
 
Figure 37(c): Asian stock markets  
3,200 24,400
3,000 23,800
2,800 23,200
2,600
22,600
2,400
22,000
2,200
21,400
2,000
20,800
1,800
1,600 20,200
1,400 19,600
1,200 19,000
Shanghai Composite (SSEC) SZSE Composite Index (SZSC) Nikkei 225 (N225)
 
Data source: Country Stock Exchanges; http://www.investing.com  
 
25 
 
SSCE & SZSC London Stock Exchange
Jul-18 Jul-18
Aug-18 Aug-18
Sep-18 Sep-18
Oct-18 Oct-18
Nov-18 Nov-18
Dec-18 Dec-18
Jan-19 Jan-19
Feb-19 Feb-19
Mar-19 Mar-19
Apr-19 Apr-19
May-19 May-19
Jun-19 Jun-19
Jul-19 Jul-19
Aug-19 Aug-19
Sep-19 Sep-19
Oct-19 Oct-19
Nov-19 Nov-19
Dec-19 Dec-19
Nikkei 225 EuroNext 100
Figure 37(d): African stock markets  
6,000 2,000
5,600 1,880
5,200 1,760
4,800 1,640
4,400 1,520
4,000 1,400
3,600 1,280
3,200 1,160
2,800 1,040
2,400 920
2,000 800
South Africa 40 NSE20 (Kenya) EGX100 (Egypt) NGSE30 (Nigeria)
 
Data source: Country Stock Exchanges; http://www.investing.com  
 
 
  
26 
 
South Africa 40 & NSE20
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
EGX100 & NGSE30
6. Risk-related Factors  
 
 
Table 1: Sovereign credit ratings for select African economies (As at June 2019) 
 
Country Credit Rating 
Grade Moody's Fitch S&P 
Angola B3 B (12/07/2019) B- (11/08/2017) 
Botswana A2  A- (15/02/2010) 
Cameroon   B (26/02/2007) B (07/06/2019) 
Egypt B2 B+ (21/03/2019) B (11/05/2019) 
Ethiopia  B (23/11/2018)  
Ghana Not rated B (18/03/2019) B (14/09/2019) 
Kenya B1 (January 2019) B+ (30/04/2019) B+ (19/11/2010) 
Morocco Ba1 BBB- (11/04/2019) BBB- (23/03/2010) 
Mauritius Baa1   
Mozambique Caa3 RD (10/05/2019) SD (18/01/2017) 
Namibia Ba1 BB+ (13/08/2018)  
Rwanda  B+ (02/11/2018) B (09/09/2016) 
South Africa Baa3 BB+ (06/12/2018) BB (24/11/2017) 
Uganda  B+ (28/06/2019) B (17/01/2014) 
    
Grade Moody's Fitch S&P 
Prime (lowest level of credit risk) Aaa AAA AAA 
Aa1 AA+ AA+ 
High grade  
Aa2 AA AA 
(very low credit risk) 
Aa3 AA- AA- 
A1 A+ A+ 
Upper medium grade  
A2 A A 
(Low credit risk) 
A3 A- A- 
Baa1 BBB+ BBB+ 
Lower medium grade  
Baa2 BBB BBB 
(Moderate credit risk) 
Baa3 BBB- BBB- 
Non-investment grade Ba1 BB+ BB+ 
Speculative  Ba2 BB BB 
(Substantial credit risk) Ba3 BB- BB- 
B1 B+ B+ 
Highly speculative  
B2 B B 
(High credit risk) 
B3 B- B- 
Caa1 CCC+ CCC+ 
Substantial risks  
Caa2 CCC CCC 
(Very high credit risk) 
Caa3 CCC- CCC- 
Ca CC CC 
Extremely speculative 
  C   
Data source: Standard & Poor’s, Fitch, Moody’s; https://countryeconomics.com  
 
 
 
 
 
 
27 
 
 
Figure 38: Kenya purchasing managers’ index  
56.0
54.0
52.0
50.0 50 = Neutral
48.0
46.0
44.0
 
Data Source: Stanbic Bank (https://www.stanbicbank.co.ke); IHS-Markit (https://ihsmarkit.com)   
Key: 50.0 = Neutral; Above 50.0 = Expansion; Below 50.0 = Contraction 
 
 
Figure 39: Mean annual and seasonal rainfall   
 1,200.0
 1,100.0
 1,000.0
 900.0
 800.0
 700.0
 600.0
 500.0
 400.0
 300.0
 200.0
 100.0
 -
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
March-May June-August October-December Annual
 
Data Source: Kenya National Bureau of Statistics; Kenya Meteorological Department; 
https://www.worldweatheronline.com/         
28 
 
Rainfall in Milimeters
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Contraction Expansion
 
 
 
Figure 40: Mean monthly temperature (Degrees Celsius)    
27.00
26.00
25.00
24.00
23.00
22.00
21.00
20.00
19.00
2018 2019
 
Data Source: Kenya Meteorological Department; https://www.worldweatheronline.com/     
 
 
 
 
29 
 
Mean Monthly Temperature 
January
February
March
April
May
June
July
August
September
October
November
December