Nairobi: The Central Bank of Kenya (CBK) on Wednesday reduced its benchmark lending rate to 10.75 percent from 11.25 percent, aiming to boost economic growth.

According to Namibia Press Agency, the performance of Kenya's economy slowed in the third quarter of 2024, with Gross Domestic Product (GDP) growing by 4.0 percent, down from 6.0 percent a year ago. CBK Governor Kamau Thugge, who chaired the Monetary Policy Committee (MPC) meeting in Nairobi, highlighted this slowdown during a statement released in the capital.

"The growth of the economy in 2024 is estimated at 4.6 percent compared to 5.6 percent in 2023, mainly reflecting deceleration in growth in most sectors of the economy," Thugge noted. He explained that the decelerated economic growth in 2024 allows for a further easing of the monetary policy stance to support economic activity while ensuring exchange rate stability.

The CBK governor also pointed out that the MPC met against a backdrop of an improved global outlook for growth, amid elevated uncertainties, lower but sticky inflation in advanced economies, and persistent geopolitical tensions.

According to the central bank, overall inflation is expected to remain below the mid-point of the target range in the near term. This expectation is supported by low and stable core inflation, an anticipated easing of energy prices, and stable exchange rates.