Answer to Question #128466 in Macroeconomics for Denis

Question

The exchange rate of US Dollar to Kenya shilling has moved from 104 in March to 108 (Kenya shilling to one dollar) as of now. Discuss the factors that may have contributed to that movement.

Answer 1

The factors that may have contributed to that movement are: the Kenyan economy downturn, negative expectations about the exchange rate, increase in imports, decrease in exports, the need to repay the government debt etc.