- Remittances fell to $427.4 million (Ksh55.5 billion) in January, down from $445.4 million (Ksh57.9 billion) in December 2024.
- CBK data shows remittances were still higher than January 2024, which recorded $412.4 million (Ksh53.6 billion).
- U.S. remains the largest source, accounting for 53.2% of January inflows.
- Total remittances over the last 12 months hit $4.96 billion (Ksh634 billion), a 16.6% increase year-on-year.
- Diaspora funds contribute 3-4% of Kenya’s GDP, supporting the economy and the Kenyan shilling.
The CBK did not specify reasons for the decline, but financial analysts suggest:
- Global economic shifts and changing foreign policies could be affecting remittance flows.
- Concerns over President Donald Trump’s new immigration and funding policies might impact future U.S. remittances.
Economic Impact
Despite the January decline, remittances remain a key economic driver:
- FX reserves stood at $9.4 billion (Ksh1.2 trillion) as of February 13, covering 4.8 months of imports.
- Kenya remains the third-largest remittance recipient in Sub-Saharan Africa.
While the January dip raises concerns, the long-term remittance trend remains positive, helping bolster economic stability and foreign exchange reserves.
