Nairobi. The Central Bank of Kenya retained the policy lending rate at 18 per cent in its monthly meeting this week, signalling a gradual shift in its monetary policy prompted by stabilising inflation and exchange rate.

The bank’s Monetary Policy Committee (MPC) had increased the policy rate by nearly three-fold from 6.5 per cent to 18 per cent in less than three months in response to a rapidly depreciating shilling and soaring commodity prices.

On Wednesday, the regulator noted that the decision to hold interest rates was in recognition of the ease in inflation from a year-high of 19.72 per cent in November to 18.93 per cent last month, while the shilling has strengthened to about 87 units to the dollar from October’s record low of 107 units. (Daily Nation)

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