The Central Bank of Kenya left its benchmark interest rate at 9% during its September meeting, as widely expected, saying that inflation remained well anchored within the target range and that the economy was operating close to its potential. The Committee also noted that the projected tightening of fiscal policy will probably provide scope for accommodative monetary policy in the near term. Still, policymakers stressed that there is need to remain vigilant on the possible effects of the increased uncertainties in the external environment, namely the escalation of trade tensions between the US and China, other geo-political tensions which have resulted in volatile international markets, and shifting expectations on the nature and timing of Brexit. Interest Rate in Kenya averaged 13.72 percent from 1991 until 2019, reaching an all time high of 84.67 percent in July of 1993 and a record low of 0.83 percent in September of 2003.

Interest Rate in Kenya is expected to be 9.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Kenya to stand at 8.00 in 12 months time. In the long-term, the Kenya Interest Rate is projected to trend around 7.50 percent in 2020, according to our econometric models.

Kenya Interest Rate
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Calendar GMT Actual Previous Consensus TEForecast
2019-03-27 01:30 PM Interest Rate Decision 9% 9% 9% 9%
2019-05-27 01:30 PM Interest Rate Decision 9% 9% 9% 9%
2019-07-24 01:30 PM Interest Rate Decision 9% 9% 9% 9%
2019-09-23 01:30 PM Interest Rate Decision 9% 9% 9% 9%



Kenya Holds Policy Rate Steady at 9%

The Central Bank of Kenya left its benchmark interest rate at 9% during its September meeting, as widely expected, saying that inflation remained well anchored within the target range and that the economy was operating close to its potential. The Committee also noted that the projected tightening of fiscal policy will probably provide scope for accommodative monetary policy in the near term. Still, policymakers stressed that there is need to remain vigilant on the possible effects of the increased uncertainties in the external environment, namely the escalation of trade tensions between the US and China, other geo-political tensions which have resulted in volatile international markets, and shifting expectations on the nature and timing of Brexit.

Excerpts from the MPC Press Release:

Month-on-month overall inflation remained within the target range in July and August 2019, and is well anchored. The inflation rate fell to 5.0 percent in August from 6.3 percent in July, reflecting decreases in the prices of both vegetable and non-vegetable food crops due to improved supply. Food inflation declined to 6.7 percent in August from 7.9 percent in July following improved weather conditions. Non-food-non-fuel (NFNF) inflation remained below 5 percent, indicative of muted demand pressures and spillover effects of the excise tax indexation in July and recent increase in fuel prices. Overall inflation is expected to remain within the target range in the near term mainly due to expectations of lower food prices with the expected favourable weather conditions, and lower electricity prices reflecting the reduced usage of expensive power sources. The recent increase in international oil prices is expected to exert moderate upward pressure on fuel prices, but with limited pass-through effects on inflation. 

Private sector credit grew by 6.3 percent in the 12 months to August, compared to 6.1 percent in July. Strong growth in credit to the private sector was observed in the following sectors: trade (8.4 percent); manufacturing (7.5 percent); consumer durables (23.0 percent); private households (8.6 percent); and finance and insurance (6.3 percent). The uptake of credit particularly by Micro, Small and Medium Enterprises (MSMEs) is expected to increase as innovative new credit products in the banking sector become fully deployed. Credit uptake will also be supported by ongoing reforms in the banking sector to strengthen the credit information sharing mechanism and promote transparency in pricing. The banking sector remains stable and resilient.

Leading indicators of economic activity such as growth in electricity and cement consumption, tourist arrivals, consumption-based taxes, and imports of intermediate goods, indicate that growth has remained strong in 2019. This is expected to continue for the rest of the year, supported by agricultural production, implementation of the Big 4 agenda, strong growth of MSMEs and the service sector, foreign direct investment and a stable macroeconomic environment. The MPC Private Sector Market Perception Survey conducted in September 2019 indicates that inflation expectations remain well anchored within the target range, mainly due to expectations of lower food prices following improved supply. Nevertheless, the optimism is tempered by concerns about the effect of trade tensions between the U.S. and China on global growth, slow growth in private sector credit and the remaining pending bills in both the public and private sectors.

The MPC noted that inflation expectations remained well anchored within the target range, and that the economy was operating close to its potential. The Committee also noted the prospective tightening of fiscal policy which would provide scope for accommodative monetary policy in the near term. Nevertheless, there is need to remain vigilant on the possible effects of the increased uncertainties in the external environment. The MPC concluded that the current policy stance remains appropriate, and therefore decided to retain the CBR at 9.00 percent. 

The MPC will continue to closely monitor developments in the global and domestic economy, including any perverse response to its previous decisions, and stands ready to take additional measures as necessary.



Central Bank of Kenya | Luisa Carvalho | luisa.carvalho@tradingeconomics.com
9/23/2019 2:39:20 PM



Kenya Money Last Previous Highest Lowest Unit
Interest Rate 9.00 9.00 84.67 0.83 percent [+]
Interbank Rate 2.28 2.98 68.30 0.40 percent [+]
Money Supply M1 1476.42 1510.78 1520.26 71.50 KES Billion [+]
Money Supply M2 2864.61 2892.62 2892.62 231.09 KES Billion [+]
Money Supply M3 3472769.18 3509434.75 3509434.75 244755.00 KES Million [+]
Foreign Exchange Reserves 13088.80 13187.30 13368.60 853.00 USD Million [+]
Deposit Interest Rate 8.30 7.70 18.40 2.43 percent [+]
Loans To Private Sector 2326105.00 2335247.00 2344446.00 166281.00 KES Million [+]


Kenya Interest Rate

In Kenya, interest rates decisions are taken by The Monetary Policy Committee (MPC) of the The Central Bank of Kenya. The official interest rate since August 2005 is the Central Bank Rate (CBR), which replaced the 91-day Treasury Bill (TB) rate. This page provides the latest reported value for - Kenya Interest Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news. Kenya Interest Rate - actual data, historical chart and calendar of releases - was last updated on October of 2019.

Actual Previous Highest Lowest Dates Unit Frequency
9.00 9.00 84.67 0.83 1991 - 2019 percent Daily




Country Last Previous
Argentina 68.00 Oct/19
Turkey 16.50 Sep/19
Mexico 7.75 Sep/19
Russia 7.00 Sep/19
South Africa 6.50 Sep/19
Brazil 5.50 Sep/19
Indonesia 5.25 Sep/19
India 5.15 Oct/19
China 4.20 Oct/19
Saudi Arabia 2.50 Sep/19
United States 2.00 Sep/19
Canada 1.75 Sep/19
Singapore 1.72 Sep/19
South Korea 1.25 Oct/19
Australia 0.75 Oct/19
United Kingdom 0.75 Sep/19
Euro Area 0.00 Sep/19
France 0.00 Sep/19
Germany 0.00 Sep/19
Italy 0.00 Sep/19
Netherlands 0.00 Sep/19
Spain 0.00 Sep/19
Japan -0.10 Sep/19
Switzerland -0.75 Sep/19


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