Focus on inflation as CBK signals interest rates policy tomorrow

Monday, March 28th, 2022 03:00 | By
Central Bank of Kenya - loans PHOTO/Courtesy
Central Bank of Kenya. PHOTO/Courtesy

The Central Bank of Kenya (CBK) will meet tomorrow to fix the benchmark policy interest rates in the backdrop of rising cost of living, and focus on the August General Elections.

“The next meeting of the Monetary Policy Committee (MPC) will be held on Tuesday, March 29, 2022,” the regulator said.

CBK has maintained interest rates at 7 per cent since 2020  with analysts had predicted that the CBK predicting a review of rates into the second half of the year.

However, with the elections just around the corner and global inflation surging in the past few months, it seems things may change, especially after Russia’s attack on Ukraine which has spiked the cost of fuel and food.

“Concerns regarding the ongoing Russian-Ukraine conflict continued. International oil prices rose during the week ending March 24, owing to inventory draw downs,” the central bank said in its weekly bulletin.

Commodities prices

Kenya National Bureau of Statistics (KNBS) says the overall year on year inflation rate as measured by the Consumer Price Index (CPI) was 5.08 per cent, in February 2022.

“This was mainly due to rise in prices of commodities under; food and non-alcoholic beverages (8.69 per cent); furnishings, household equipment and routine household maintenance (5.41 per cent); housing, water, electricity, gas and other fuels (4.79 per cent); and transport (4.54 per cent) between February 2021 and February 2022,” KNBS said.

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