Markets & Finance

Borrowers to feel pinch as CBK raises lending rates

Borrowers face more pain after the Central Bank of Kenya (CBK) raised the base lending and policy rates in a bid to curb the depreciation of the Kenyan shilling, which hit the psychological 100 units to the dollar on Monday.

CBK’s Monetary Policy Committee (MPC) raised the Kenya Banks’ Reference Rate (KBRR) to 9.87 from 8.54 per cent and the Central Bank Rate (CBR) to 11.5 from 10 per cent.

“The MPC decided to raise the CBR from 10.00 to 11.50 per cent. … In view of the new CBR, the CBK has revised the KBRR from 8.54 to 9.87 per cent. This level of KBRR will be effective from July 7, 2015,” said Dr Patrick Njoroge, chairman of the MPC and the CBK governor.

READ: Weak shilling, inflation top governor’s to-do list