Central Bank of Kenya Monetary Policy Committee retained the lending rate at 8.75pc due to less impact felt in the economy after the last review.
The committee projected that inflationary pressures will ease due to the State’s move to allow duty-free imports of maize, sugar, and rice.
MPC said the decision was informed by the fact that the rate rise in the last review in November is yet to be fully felt in the economy; hence, there is no need to raise it again.
“The Committee noted that the impact of the further tightening of monetary policy in November 2022 to anchor inflationary pressures were still transmitting in the economy.”
“Additionally, the MPC noted that this action will be complemented by the recently announced government measures to allow limited duty-free imports on specific food items which are expected to moderate prices and further ease domestic inflationary pressures,” said CBK Governor Patrick Njoroge.
For six months starting Wednesday, the government will waive import duty on maize and rice to mitigate the food crisis that may be occasioned by the shortage of cereals, which are the staple food in the county.
From February 1 to August 6, traders will be allowed to import up to 900,000 tonnes of duty-free white maize and 600,000 of duty-free milled rice.
Inflation in October last year reached a five-year high of 9.59 percent. It eased to 9.1 percent by December.