Foreigners sustain exit from Nairobi bourse amid high global shocks

NAIROBI, April 20 (Xinhua) -- Foreign investors sustained capital flight from the Nairobi Securities Exchange (NSE) in the first quarter of 2023 as interest rates in the developed economies continued to rise amid high global inflation, the financial markets regulator said Thursday.

The Capital Markets Authority (CMA) said the foreign investors cut their participation to 41.2 percent during the quarter as compared to 54.8 percent recorded in quarter four of 2022.

The flight saw the foreigners increase their sales to 22.7 billion Kenyan shillings (about 168 million U.S. dollars) from 88.6 million dollars in quarter four of 2022, the CMA said in its quarterly report released in the Kenyan capital of Nairobi.

The United States is among countries in the developed world that have increased its benchmark rate in a bid to rein in inflation. The U.S. Federal Reserve in March raised its key interest rate by 0.25 percent, its ninth consecutive hike increasing it to a range of 4.75 percent to 5 percent. The high-interest rate has pushed up yields on bonds and other securities in the country pulling investors in search of higher returns away from developing markets.

Wycliffe Shamiah, CMA chief executive officer, said high global inflation has seen central banks tighten policy at an unusually rapid pace affecting markets. He, however, remains optimistic about the future of the industry.