The Central Bank of Kenya (CBK) has lowered interest rates by 75 basis points in its latest review.
The Monetary Policy Committee has today, Tuesday, October 8, 2024 announced a cut in lending rates for the second consecutive time to 12 per cent from 12.75 per cent citing a decline in inflation.
“The MPC noted that overall inflation has declined further and is expected to remain below the midpoint of the target range in the near term, supported by stable food inflation attributed to improved supply from the ongoing harvests, a stable exchange rate, and lower fuel inflation.” CBK Governor Kamau Thugge said.
Kenya’s annual inflation rate reduced to 3.6pc last month compared to 4.4 per cent in August which the bank says is well below the mid-point of the target range.
According to the committee, non-food non-fuel inflation has moderated to 3.4pc in September from 3.5 per cent and is expected to remain stable.
The latest rate cut now sets up consumers for lower cost of borrowing after a decline in credit uptake.
“The MPC also noted the sharp deceleration in credit to the private sector, and the slowdown in growth in the second quarter of 2024, and concluded that there was scope for a further easing of the monetary policy stance to support economic activity, while ensuring exchange rate stability.” Thugge added
The next committee meeting is slated for December this year.