Kenya’s Central Bank is considering boosting its gold reserves to protect against currency volatility and global economic instability.
The Central Bank of Kenya (CBK) is evaluating the potential addition of gold to its foreign exchange reserves, Governor Kamau Thugge revealed in a recent interview with Bloomberg TV. Speaking at the International Monetary Fund (IMF) and World Bank Spring Meetings in Washington, Thugge confirmed that a team has been assigned to assess the feasibility of diversifying the country’s reserves with gold holdings.
While no specific timeline was provided, the move signals a strategic shift as Kenya seeks to reduce its reliance on traditional fiat currencies, particularly the U.S. dollar.
Gold Prices Reach Record Highs Amid Economic Uncertainty
Kenya’s exploration of gold reserves comes at a time when the precious metal has reached historic highs, surpassing $3,500 per ounce — a 40% increase compared to a year earlier. Gold has emerged as the top-performing major commodity in 2025, buoyed by rising global demand, escalating geopolitical tensions, and persistent economic uncertainties.
Central banks worldwide, including several in Africa, have accelerated gold purchases to bolster their financial stability and hedge against external shocks.
Currently, Kenya’s foreign exchange reserves are heavily dominated by U.S. dollars, with a mere 0.02 tonnes (20 kilograms) of gold recorded according to the latest data. By increasing its gold holdings, the CBK aims to shield the Kenyan economy from currency fluctuations, preserve purchasing power, and enhance the resilience of its monetary system.
A Growing Trend Among African Central Banks
Kenya’s move aligns with a broader trend among African nations strengthening their gold reserves in recent years. As global financial markets become more volatile, many African central banks view gold as a strategic asset to mitigate risk and safeguard economic sovereignty.
For instance:
- Uganda’s Central Bank (BOU) launched a Domestic Gold Purchase Program to replenish declining foreign currency reserves and buffer against international financial market risks.
- Zimbabwe has initiated efforts to back its currency with gold.
- South Africa, Nigeria, and Madagascar are also actively increasing or evaluating gold holdings to fight inflation and maintain currency stability.
These efforts underscore a continental shift toward gold-backed financial strategies in the face of weakening global currencies and persistent inflationary pressures.
Top 10 African Countries by Gold Reserves (2024)
As of 2024, the leading African nations in terms of official gold reserves are:
- Algeria – 174 metric tons
- South Africa – 125 metric tons
- Libya – 117 metric tons
- Egypt – 80.73 metric tons
- Morocco – 22.12 metric tons
- Nigeria – 21.37 metric tons
- Mauritius – 12.44 metric tons
- Ghana – 8.74 metric tons
- Tunisia – 6.84 metric tons
- Mozambique – 3.94 metric tons
Kenya currently ranks far below these leaders but could strengthen its position with a strategic push into gold accumulation.
Conclusion
The Central Bank of Kenya’s exploration into gold reserves marks a pivotal step in safeguarding the country’s financial future. As more African nations turn to gold amid global uncertainty, Kenya’s initiative reflects a broader recognition of the precious metal’s enduring value as a hedge against economic instability.
As developments unfold, Kenya’s potential move into gold-backed reserves could reshape the country’s monetary landscape and inspire similar strategies across emerging markets.
