CBK retains benchmark rate to 18 percent

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.