Kenyan banks to lower interest rates following pressure from the Central Bank
- CBK reduced the benchmark rate by 75 basis points to 11.75%.
- The gap between CBR and lending rates rose to a 31-month high.
- Average interest rates increased from 16.91% to 17.15% in October.
The decision by Kenyan banks to lower lending rates is a positive step towards improving access to credit, but the slow transmission of monetary policy changes raises concerns about the effectiveness of these measures. It is crucial for banks to respond promptly to rate cuts to support economic growth, and further reductions from the CBK may be necessary to ensure that the benefits reach consumers and businesses.
