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Market News

MPC meeting set for May

Central Bank of Kenya
Central Bank of Kenya. FILE PHOTO | NMG 

The Central Bank of Kenya (CBK) will meet on 27th of next month to decide whether to review its base lending rate from the current nine percent.

Members of the Monetary Policy Committee (MPC), which sets the Central Bank Rate (CBR) that determines the cost of commercial loans, has maintained the rate at nine per cent since July last year.

The CBR is reviewed and announced by the MPC at least every two months and its movements, both in direction and magnitude, signals the monetary policy stance.

The last meeting was held on March 27 with the CBK noting that inflation expectations remained well anchored within the target range and that the economy was operating close to its potential.

It again held the rate at nine per cent.

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With CBR at nine percent, commercial loans are priced at a maximum of 13 percent. The CBR is also crucial since whenever CBK is injecting or withdrawing liquidity through a reverse repo and vertical, the policy rate determines the acceptable bid rates.

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