The Central Bank of Kenya kept its benchmark interest rate unchanged at 8.75% on June 9, 2026, marking a second consecutive pause. The Bank noted that its current policy stance remains appropriate to anchor inflation expectations and support the stability of the exchange rate.
Inflation accelerated for the third consecutive month to 6.7% in May, its highest level since January 2024, driven primarily by higher energy costs. Nonetheless, it remains within the official target range of 5% ± 2.5%. The Bank expects inflation to stay within this target in the near term, assuming a de-escalation of the conflict in the Middle East.
According to the central bank, this outlook will be underpinned by a combination of factors: ongoing monetary policy measures, government interventions such as reductions in fuel VAT and targeted subsidies, favorable weather conditions that help keep food prices stable, and continued exchange rate stability.
