Kenya Releases Local Version of FX Global Code
Posted by Colin Lambert. Last updated: March 29, 2023
The Central Bank of Kenya has published a foreign exchange code for commercial banks in the country, while based largely upon the FX Global Code the central bank says there are nuances that account for local market conventions.
The CBK says the FX Code sets out standards and aims to strengthen and promote the integrity and effective functioning of the wholesale FX market in Kenya. “It will facilitate better functioning of the market, reinforcing Kenya’s flexible exchange rate regime for greater resilience of the economy,” the central bank states.
Further reflecting the backbone of the FX Global Code, as with that document, CBK says there are six core principles, ethics, governance, execution, information sharing, risk management and compliance, and confirmation and settlement processes.
The central bank says Kenya’s FX market has expanded significantly over the years in tandem with global developments, adding, “It is an important enabler of trade, investments, and remittances into and out of the Kenyan economy.”
Progressively, the CBK in its oversight role over the FX market has enhanced the regulation and surveillance of the market. CBK continues to closely monitor the market considering its growing complexity and emerging risks to fair and effective trading, it says, explaining that it is against this backdrop that it has issued the FX Code.