American investors, both individuals and corporates, raised their portfolio holdings in Kenya by 45 percent in 2025 to Sh258 billion ($1.9 billion), the highest level in four years, highlighting renewed interest in the country’s financial markets.
US investors’ portfolio holdings in Kenyan equities and debt securities increased by Sh80 billion ($615 million) from Sh178 billion a year earlier, marking a second consecutive year of growth following a four-year decline.
According to data from the US Department of the Treasury, last year’s increase in American-held portfolios in Kenya was among the largest annual gains on record, pointing to growing appetite for Kenyan securities among US and other international investors.
The increase came against a backdrop of foreign investor outflows from several emerging and frontier markets, as global investors reassessed their exposure to riskier assets amid geopolitical tensions and uncertainty over US trade policies.
Relatively high interest rates in developed markets, particularly the US, also intensified competition for international portfolio capital.
Insiders say the increase in American holdings points to renewed interest in Kenyan financial assets, particularly government debt, which accounts for the bulk of US portfolio investments in the country.
“It’s the agility of our thinking, the agility of our products. We have taken deliberate steps to ensure that we thrive in the core pillars of order in the economy, and we’re also taking very deliberate steps to find alternative methods of direct investments locally,” Daniel Mainda, the chief executive of the Nairobi International Financial Centre, told Business Daily .
American investors’ portfolio holdings in Kenya comprise equities and long-term debt securities, with the latter accounting for the overwhelming majority of their exposure.
Investments in equities recorded the fastest growth during the year, almost doubling to Sh27 billion ($204 million) in 2024, pointing to increased exposure to Kenyan-listed companies.
The growth coincided with a recovery in the local stock market, with the Nairobi All Share Index gaining 24.3 percent in the first half of 2025, according to the CBK. Market capitalisation also rose 24.6 percent over the same period.
In August, net foreign investor purchases on the Nairobi Securities Exchange hit a record Sh1.2 billion in one month, with analysts attributing the improvement partly to easing uncertainty surrounding US President Donald Trump’s tariffs, which had disrupted global financial markets.
US investors’ holdings in Kenyan long-term debt securities also increased by 42 percent to Sh231 billion ($1.785billion), up from Sh164 billion ($1.261 billion) a year earlier, accounting for nearly 90 percent of their total portfolio.
The increase in debt holdings coincided with a decline in domestic interest rates, creating an opportunity for investors to lock in relatively attractive returns on longer-dated securities. Treasury Bill rates, for instance, averaged 8.7 percent in June 2025, down from 16.5 percent a year earlier, according to the CBK.
The government also continued to offer relatively attractive returns on long-term Treasury securities and infrastructure bonds, potentially supporting demand from foreign investors.
However, American holdings of Kenyan securities remain below the pre-Covid peak of Sh390 billion ($3 billion), suggesting that despite the recent recovery, foreign portfolio exposure has yet to return to its previous high.
