CBK holds benchmark lending rate unchanged at 7%
The Central Bank of Kenya has held the benchmark lending rate unchanged at seven percent for the 11th time.
In a Monetary Policy Committee (MPC) Meeting Monday, said the retention was key to sustaining the progressive rebound of Kenya’s economy.
“The committee noted that inflation expectations remained anchored within the target range, and leading economic indicators showed continued robust performance,” the CBK stated.
Key economic indicators have pointed out the recovery of the economy in the second half of this year, the MPC noted.
The country’s economy expanded by 5.3 percent in the first half of the year.
MPC surveys conducted earlier in the month which covers market perceptions, CEOs and hotels have revealed the highest level of optimism about economic growth prospects since March this year.
“Respondents attributed this optimism to sustained recovery across different sectors, the lifting of the curfew, reduced COVID-19 infection numbers and increased vaccinations, continued government infrastructure spending, and the global economic recovery which is expected to boost export demand,” added the CBK.
“Additionally, respondents expect consumer demand to pick up during the festive and back-to-school seasons. Nonetheless, while concerns about the pandemic have eased, respondents remained concerned about the dry weather conditions and increased political activity.”
Growth in private sector credit increased to 7.8 percent in October 2021 from seven percent in August with manufacturing, consumer durables, transport & communication and business services sectors being the largest recipients of new credit in the period.