@StandardMedia

Central Bank of Kenya lowers monetary easing to curb inflation

1 weeks ago, 16:06

By: Valentine Kondo

Rise in inflation occasioned by a recent implementation of eight percent value added tax.

Central Bank made two cuts on the lending rates this year of 0.5 percent and 9.5 percent. 

Core inflation accelerated to 4.7 per cent from 4.2 per cent in August.

Inflation hit high in September to a 5.7 percent from a previous of 4.04 percent in August since the implementation of Finance Bill 2018.

Central Bank of Kenya moved to lower monetary easing due to rise in inflation occasioned by a recent implementation of eight percent value added tax.

The resolve comes amid the recent decision by the Central Bank making two cuts on the lending rates this year of 0.5 percent and 9.5 percent. CBK also made another cut of nine percent in July this year on grounds of nonthreatening inflation, constant exchange rate and an objective of lending out money to small business enterprises to improve the country’s economy.

Increase in petroleum products has seen inflation rate go high. However, economists from the commercial Bank of Kenya believe that economic growth has given the regulator a chance to fight price increases.

CBA analysts said through a note, “With rising cost-push inflation driven by recent tax measures and rising oil prices, scope for further accommodation is likely to be limited. This (rise in oil price) is likely to invite considerable caution among central banks in oil importing countries.”

Too, demand pressure for credit from the regulator has been going up for a time now. “Core inflation accelerated to 4.7 per cent from 4.2 per cent in August. While it remains below the medium term target of five per cent, sustained build-up could invite a tightening response from the Central Bank,” claimed the analysts.

CBA economists held that the country was experiencing economic growth of 6.3 percent in the second quarter.

Inflation hit high in September to a 5.7 percent from a previous of 4.04 percent in August since the implementation of Finance Bill 2018.

CBK had but a cap on lending rates by commercial banks that economists believe had a negative impact on the economic growth of the country.

Current inflationary pressure resulting from increased oil prices stands at four-year high of $85 a container.

 


Read More


Category: business news

Suggested

13 hours ago, 00:00
@StandardMedia - By: Dominic Omondi
Rai firms tighten grip on local sugar industry

Report by Sugar Directorate looked at sector’s performance in first nine months of 2018. ...

Category: business news
5 hours ago, 08:04
@BusinessDaily - By: Lynet Igadwah
Small traders’ Sh12bn imports held at harbour set for auction

Multi-agency team on illicit goods says the consignment will be sold in next two weeks ...

Category: business news
1 day ago, 11:58
@StandardMedia - By: Valentine Kondo
Rwanda seeks to woo investors in bid to explore hydrocarbons

East African Nation, Rwanda is seeking to partner with oil and gas companies to explore Lake Kivu for hydrocarbons said a state official. ...

Category: business news
13 hours ago, 00:09
@StandardMedia - By: Standard Reporter
Stanbic, leasing firm to offer affordable laptops to students

Stanbic Bank has partnered with RentCo Leasing and Cool4School to launch a leasing scheme that will deliver affordable laptops to students. ...

Category: business news
1 day ago, 00:00
@StandardMedia - By: Nehemiah Okwembah
Malindi court slaps Sh60 million bonds on elderly suspects

Six men charged with land fraud have been released on a Sh20 million bond. ...

Category: business news
13 hours ago, 00:17
@TheStar - By: Abel Muhatia @muh ...
Give tax breaks to regain exports market — KAM

Manufacturers now want a break from the import declaration fee of two per cent and the railway development levy of 1.5 per cent. Speaking during the unveiling of the sectors deep-dive report on Thursd ...

Category: topnews news business

@StandardMedia

Central Bank of Kenya lowers monetary easing to curb inflation

1 weeks ago, 16:06

By: Valentine Kondo

Rise in inflation occasioned by a recent implementation of eight percent value added tax.

Central Bank made two cuts on the lending rates this year of 0.5 percent and 9.5 percent. 

Core inflation accelerated to 4.7 per cent from 4.2 per cent in August.

Inflation hit high in September to a 5.7 percent from a previous of 4.04 percent in August since the implementation of Finance Bill 2018.

Central Bank of Kenya moved to lower monetary easing due to rise in inflation occasioned by a recent implementation of eight percent value added tax.

The resolve comes amid the recent decision by the Central Bank making two cuts on the lending rates this year of 0.5 percent and 9.5 percent. CBK also made another cut of nine percent in July this year on grounds of nonthreatening inflation, constant exchange rate and an objective of lending out money to small business enterprises to improve the country’s economy.

Increase in petroleum products has seen inflation rate go high. However, economists from the commercial Bank of Kenya believe that economic growth has given the regulator a chance to fight price increases.

CBA analysts said through a note, “With rising cost-push inflation driven by recent tax measures and rising oil prices, scope for further accommodation is likely to be limited. This (rise in oil price) is likely to invite considerable caution among central banks in oil importing countries.”

Too, demand pressure for credit from the regulator has been going up for a time now. “Core inflation accelerated to 4.7 per cent from 4.2 per cent in August. While it remains below the medium term target of five per cent, sustained build-up could invite a tightening response from the Central Bank,” claimed the analysts.

CBA economists held that the country was experiencing economic growth of 6.3 percent in the second quarter.

Inflation hit high in September to a 5.7 percent from a previous of 4.04 percent in August since the implementation of Finance Bill 2018.

CBK had but a cap on lending rates by commercial banks that economists believe had a negative impact on the economic growth of the country.

Current inflationary pressure resulting from increased oil prices stands at four-year high of $85 a container.

 


Read More

Category: business news

Suggested

13 hours ago, 00:00
@StandardMedia - By: Dominic Omondi
Rai firms tighten grip on local sugar industry

Report by Sugar Directorate looked at sector’s performance in first nine months of 2018. ...

Category: business news
5 hours ago, 08:04
@BusinessDaily - By: Lynet Igadwah
Small traders’ Sh12bn imports held at harbour set for auction

Multi-agency team on illicit goods says the consignment will be sold in next two weeks ...

Category: business news
1 day ago, 11:58
@StandardMedia - By: Valentine Kondo
Rwanda seeks to woo investors in bid to explore hydrocarbons

East African Nation, Rwanda is seeking to partner with oil and gas companies to explore Lake Kivu for hydrocarbons said a state official. ...

Category: business news
13 hours ago, 00:09
@StandardMedia - By: Standard Reporter
Stanbic, leasing firm to offer affordable laptops to students

Stanbic Bank has partnered with RentCo Leasing and Cool4School to launch a leasing scheme that will deliver affordable laptops to students. ...

Category: business news
1 day ago, 00:00
@StandardMedia - By: Nehemiah Okwembah
Malindi court slaps Sh60 million bonds on elderly suspects

Six men charged with land fraud have been released on a Sh20 million bond. ...

Category: business news
13 hours ago, 00:17
@TheStar - By: Abel Muhatia @muh ...
Give tax breaks to regain exports market — KAM

Manufacturers now want a break from the import declaration fee of two per cent and the railway development levy of 1.5 per cent. Speaking during the unveiling of the sectors deep-dive report on Thursd ...

Category: topnews news business
Our App