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Bloomberg
Kenya surprised most analysts by keeping its benchmark interest rate unchanged for the first time since July, as it sees inflation declining in the near term.
The monetary policy committee held the rate at 8.75%, Governor Patrick Njoroge said in an emailed statement. Only two of five economists in a Bloomberg survey expected the rate to remain unchanged.
The pause will allow a 50-basis point hike in November to transmit in the economy, the governor said. That and government measures to allow limited duty-free imports on specific food items are expected to moderate prices and further ease domestic inflationary pressures, he said.
Kenya joins more than a third of global central banks from Hungary to Chile in pausing their tightening campaigns as inflation shows signs of cooling and economies slow down.
The rate of price growth in East Africa’s largest economy while remaining above the 7.5% upper limit of the MPC’s target since June has dropped for two straight months to 9.1%. A median estimate of five economists surveyed by Bloomberg expect data from statistic agency to show inflation quickened to 9.3% this month.