Even after inflation in the country significantly falling
since December last year, the Monetary Policy Committee has left CBK benchmark
at 18 per cent. This is together with introduction of longer tenor Term Auction
Deposits as a liquidity management tool.
The committee met on Tuesday and observed that the monetary policy
measures taken continued to deliver a gradual decline in inflation in the
country. However, the global foreign exchange markets witnessed a revival of turbulence
in May attributed mainly to the instability experienced in the Euro Zone.
As a result, the US Dollar has gained over other currencies
globally as investors shift from Euro to assets denominated in US Dollars. This
is according to the statement, ‘Sustaining Stability in the Face of External
Shocks’ by the Monetary Policy Committee.
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