The Central Bank of Kenya on Monday held its benchmark lending rate at 9.0% as per analysts expectations. The Monetary Policy Committee said inflation was anchored within the target range.
“The MPC concluded that the current policy stance remains appropriate, and will continue to monitor any perverse response to its previous decisions.”
However, “Global growth is expected to weaken in 2019, with increased uncertainties with regard to the
trade tensions between the U.S. and China, Brexit negotiations, slowdown of the Chinese economy, the partial shutdown of the U.S. government, and the pace of normalization of monetary policy in the advanced economies. These developments could lead to higher volatility in the global financial markets.”
The MPC Private Sector Market Perception Survey conducted in January 2019 indicated that inflation expectations were well anchored within the target range, with respondents revising their inflation expectations for the near term downwards on account of expected lower prices of food, fuel and electricity.
“Nevertheless, the optimism was tempered by the slow growth in private sector credit, and concerns of a likely slowdown in global growth in 2019.”