The Central Bank of Kenya (CBK) has cut its benchmark lending rate for the eighth consecutive meeting, lowering it from 9.50% to 9.25%, saying there is still room for further monetary easing.
The Monetary Policy Committee (MPC) said the 25 basis point reduction aims to stimulate bank lending to the private sector and support economic activity, while keeping inflation expectations well anchored.
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Consumer inflation stood at 4.6% in September, slightly up from 4.5% in August, but comfortably within the 2.5%–7.5% target range.
The central bank also slightly raised its 2026 growth forecast to 5.5% from 5.4% projected earlier, while maintaining its 2025 growth outlook at 5.2%. Growth is expected to be driven by continued resilience in the services and agriculture sectors, as well as a recovery in industry.
Meanwhile, the current account deficit is now expected at 1.7% of GDP this year, compared with a previous estimate of 1.5%.
Despite a heavy debt burden, Kenya continues to manage refinancing risks through bond buybacks and other measures aimed at stabilizing its financial position.
