The skyline in Kenya

Kenya Monetary Policy September 2021

Kenya: Central Bank stands pat in September

At its 28 September meeting, the Monetary Policy Committee of Kenya’s Central Bank decided to leave its key rate unchanged at 7.00%, marking the tenth consecutive hold, after having cut it by 125 basis points during March–April 2020.

Estimates of a strong recovery in 2021, coupled with relatively well-anchored inflation expectations, were largely behind the Bank’s decision to maintain its accommodative stance. Available indicators point to a robust recovery this year, while ongoing vaccination efforts at home and abroad should further support the services sector and buoy demand globally. Meanwhile, despite mounting price pressures recently due to higher fuel and food costs, inflation is expected to remain within the Bank’s 2.5%–7.5% target band in the medium term.

The Bank’s communiqué did not include any strong forward guidance. However, unlike previous meetings, the Bank put stronger emphasis on building price pressures and inflation expectations, stressing that it will “need to closely monitor developments in inflation and stands ready to respond to any second-round effects”. Most of our panelists expect the Central Bank rate to end 2021 at 7.00%.

The next meeting is scheduled to take place in November.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest