MPC meets on Novem­ber 28 to set new base rate

The Star (Kenya) - - News -

The Cen­tral Bank of Kenya’s top de­ci­sion-mak­ing or­gan, the Mon­e­tary Pol­icy Com­mit­tee, will hold its next meet­ing on Novem­ber 28, it said yes­ter­day, with the out­come closely watched by banks. Dur­ing its last meet­ing on Septem­ber 20, the MPC cut the Cen­tral Bank Rate by 50 ba­sis points to 10 per cent, against the wish of ma­jor­ity of an­a­lysts.The de­ci­sion re­sulted in banks be­ing re­quired to lower max­i­mum in­ter­est on loans to 14 per cent, barely a week af­ter the Bank­ing (Amend­ment) Act 2016 came into force with an in­ter­est cap at 14.5 per cent. The amended law re­quires the banks not to charge more than four per­cent­age points above the CBR on loans, and pay a min­i­mum in­ter­est of 70 per cent of the CBR on term de­posits. The de­ci­sion is driven by trends in in­fla­tion which rose slightly.

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