Kenyans To Enjoy Cheaper Loans After CBK's Latest Move
This new rate is down from the previous 10.00% and aims to boost economic activity while keeping inflation in check and the exchange rate stable.
Viral Tea Ke Writer 
Kenyans can expect to see lower interest rates on bank loans after the Central Bank of Kenya (CBK) reduced its key lending rate by 0.25% to 9.75%.
The Monetary Policy Committee (MPC) announced this decision on Tuesday, June 10, stating that they believe there's room to ease monetary policy further without negatively impacting inflation or the exchange rate.
This new rate is down from the previous 10.00% and aims to boost economic activity while keeping inflation in check and the exchange rate stable.
Central Bank of Kenya (CBK) governor Kamau Thugge during a past forum. /KENYA BANKING INSIGHTS
“The MPC will closely monitor the impact of this policy decision as well as developments in the global and domestic economy and stands ready to take further action as necessary in line with its mandate. The Committee will meet again in August 2025,” read the report from the committee in part.
The Central Bank of Kenya (CBK) further noted that inflation is continuing to decline, with initial indicators of economic recovery emerging.
This decision to reduce the lending rate comes amid worries about a global economic slowdown, with projected growth decreasing to 2.8% in 2025 from 3.3% in 2024.
This slowdown is primarily due to weaker growth in the U.S. and China, the world's two largest economies, which are being impacted by increased trade tariffs and ongoing geopolitical tensions. While both nations have softened their tariff threats, uncertainty persists regarding ongoing trade discussions.
Meanwhile, global inflation has eased somewhat but remains persistent in certain regions. Oil prices have stabilised due to increased production and weak demand, particularly from China.
Food inflation has decreased, especially for cereals and sugar, though edible oil prices remain elevated.
Kenyan Economic Outlook
In Kenya, inflation fell to 3.8% in May from 4.1% in April, which is below the Central Bank's target midpoint. The CBK attributes this drop to lower vegetable prices and reduced electricity costs.
However, core inflation (excluding food and energy) saw a slight increase to 2.8% in May from 2.5% in April, driven by higher prices for processed food.
