(Nairobi) – The Central Bank of Kenya (CBK) has announced that its next rate-setting meeting will take place on December 5, 2024. This follows the bank’s recent move in October to cut its benchmark lending rate to 12.00%, down from 12.75%. The decision was made as part of efforts to stimulate credit growth to the private sector.
The CBK’s Monetary Policy Committee (MPC) is responsible for reviewing the country’s monetary policy and making adjustments to the benchmark interest rates, which influence lending and borrowing costs across the economy. This meeting in December will be closely watched as the bank assesses the impact of its previous rate cuts and decides whether further action is necessary.
The recent rate cut was part of the central bank’s strategy to encourage more lending to businesses and individuals, especially in a challenging economic environment. The bank aims to stimulate economic activity by making credit more affordable, thus promoting investment and consumption. The decision to lower rates is typically influenced by factors such as inflation trends, economic growth, and the overall health of the financial system.
In the past, the central bank has adjusted interest rates in response to shifts in inflation and economic growth. The move to reduce rates in October was seen as a response to the country’s lower-than-expected inflation, which had eased to below 3% by the end of September.
The December meeting will likely focus on evaluating whether the recent rate cuts have had the desired effect on credit growth and private sector activity. As inflation remains low, the central bank may decide to keep rates steady or implement further cuts if it believes that the economy still needs additional stimulus.
The outcome of this meeting will be critical for both consumers and businesses in Kenya, as it will determine the cost of borrowing in the coming months. Many businesses rely on credit to finance operations, while consumers are also affected by interest rates on loans, mortgages, and credit cards.
The Central Bank of Kenya’s actions are closely monitored by financial markets, analysts, and policymakers, as changes in interest rates have wide-reaching effects on the economy.