Central Bank lowers key rate to 9.5pc

Business
By Sofia Ali | Aug 12, 2025

Central Bank of Kenya's Monetary Policy Committee has lowered its benchmark rate to 9.50 per cent as it continued its policy this year to stimulate lending by banks and support economic activity.

During its meeting on Tuesday, the committee cut the Central Bank Rate by 25 basis points from the 9.75 set in its June 11 meeting, citing favourable inflation and positive economic growth outlook in the short term. 

"The recently released GDP data for the first quarter of 2025 showed continued resilience of the Kenyan economy, with real GDP growing by 4.9 per cent," CBK Governor Kamau Thugge said in a statement after the meeting.

"This reflected robust performance of agriculture, and recovery in industrial activity, particularly construction. Leading indicators of economic activity point to improved performance in the second quarter of 2025."

He said growth in commercial banks’ lending to the private sector continued to improve and stood at 3.3 per cent in July 2025 compared to 2.2 per cent in June. 

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