Concerns Persist as Global Oil Prices Decline in First Week of May

Concerns about inflation persisted while global prices decreased during the week ending May 7, 2026.

This is according to the Central Bank of Kenya (CBK) weekly report published on Friday, May 9.

In the report, CBK said the inflation concerns were driven by sustained underlying price pressures, particularly in services and energy.

U.S. labour market conditions in April 2026 showed a moderation in job growth.

The unemployment rate stood at 4.3 percent, with modest wage increases pointing to continued labour market tightness despite slower hiring and firing.

The US Dollar Index weakened by 0.3 percent during the week, reflecting reduced demand for safe-haven assets.

Global Oil Prices

CBK said international oil prices declined due to easing supply conditions and concerns over weakening global demand.

Murban oil prices declined from $100.21 (Ksh 12942.12) on April 30 to $89.13 (Ksh 11,515.40) on May 7.

“International oil prices declined during the week ending May 7, reflecting concerns over weakening global demand alongside easing supply conditions. Murban crude oil prices declined to USD 89.13 per barrel on May 7, from USD 100.21 per barrel on April 30,” CBK said.

Exchange Rates

The Kenyan shilling remained stable against major international and regional currencies during the week ending May 7, 2026.

It exchanged at Ksh 129.19 per U.S. dollar on May 7, the same as KSh 129.19 on April 30.

Foreign Exchange Reserves

The foreign exchange reserves remained adequate at USD 13,414 million (5.7 months of import cover) as of May 7.

This meets CBK’s statutory requirement to endeavour to maintain at least 4 months of import cover.

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Money Market

The money market remained liquid during the week ending May 7, 2026, with open market operations remaining active.

Commercial banks’ excess reserves averaged Ksh 32.0 billion above the 3.25 percent Cash Reserve Ratio (CRR) requirement.

The Kenya Shilling Overnight Interbank Average Rate (KESONIA) remained unchanged at 8.75 percent on May 7, the same as on April 30.

During the week, the average number of interbank transactions increased to 25 from 24 in the previous week, while the average value traded increased to Ksh 10.1 billion from Ksh 8.7 billion.

Government Securities Market

The Treasury bill auction of May 7 received bids totalling Ksh 29.4 billion against an advertised amount of Ksh 24.0 billion, representing a performance of 122.6 percent.

Interest rate on the 91-day and 364-day Treasury bills increased.

However, the interest rate on the 182-day Treasury bill declined marginally.

During the Treasury bond auction of May 6, the three reopened 20-year and 25-year treasury bonds received bids totaling Ksh 106.0 billion against an advertised amount of Ksh 80.0 billion, representing a performance of 132.5 percent.

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Equity Market

At the Nairobi Securities Exchange, the NASI and NSE 25 share price indices increased by 1.88 percent and 0.31 percent, respectively, while the NSE 20 decreased by 0.62 percent during the week ending May 7, 2026.

Market capitalization, total shares traded, and equity turnover also increased by 1.89 percent, 13.03 percent, and 15.09 percent, respectively.