Attorney-General Githu Muigai Thursday termed Mr Odinga’s inauguration plan as ‘treasonable’, offering a hint at how the Kenyatta regime might respond to it.
Analysts see this new political development as a key risk to the recent rallying of markets that have seen stock prices recover and the shilling strengthen against major world currencies as foreign investors return to the domestic market.
“This political development on the back of lower market activity as the holiday season approaches could weigh on the shilling,” a forex trader with a local commercial bank said.
The Kenyan economy has weathered a number of shocks that have forced the government and International Monetary Fund (IMF) to scale down their growth projections for 2017.
A severe drought that started in the last quarter of 2016 hurt agricultural production, forcing the World Bank to scale down its forecast by half a percentage point to 5.5 per cent in April.
A slowdown in credit growth coupled with a prolonged political season that saw the country go to its first ever repeat presidential election hurt activity in key sectors such as agriculture, manufacturing and trade – and forcing the Treasury to downgrade its growth forecast to 5.1 per cent from 5.9 per cent previously.
Some sectors, including wholesale and retail, tourism and small businesses, however performed better, according to Central Bank of Kenya Governor Patrick Njoroge.